Financial Aid: Why is buying a degree like buying a car?

@knowsstuff, I work at a small LAC. I think the term you’re looking for is “reevaluating the financial aid package.” :wink: But you’re correct; comparisons can be made. I don’t call that negotiating, though, because families generally don’t have much power in the discussions.

I don’t think the financial aid policies are meant to be difficult. I think some of these schools are trying to make college affordable for middle income families whose kids have solid stats. We get a lot of posts from people complaining they’re in a donut hole and there’s no aid for them, but I suspect that if they went down a tier or two to some of these very good schools they might get something. The issue seems to be that people want name brands, so what they mean is there’s no aid at the schools their kids are willing to attend.

I forgot to mention, @packattack1018, the FAFSA is really only used to calculate Pell Grant eligibility and to arrange the federal student loan. The colleges that give the best aid use their own financial aid form and those ask a lot more questions than the FAFSA.

I understand what you’re saying about transparency and I admit I found it a little frustrating too. But I’ve heard enough real life situations to understand why colleges need the flexibility. If they only gave a set amount of aid to the top 5% of students what can they do for the kid who suddenly loses a parent? If they consider debt, what do they do about the people who dump hundreds of thousands of dollars into a million dollar property that they plan to unload as soon as junior gets their last financial aid check? People will do all kinds of crazy things to get financial aid (see the thread about parents’ giving up guardianship of their kids), so I understand why colleges want to review each application individually and not give blanket guarantees.

We ran the Net Price Calculators and let our kids apply only to schools that were in our price range. As long as your daughter is clear about your budget you should end up with some good choices in April.

@austinmshauri excellent post. But if we start with $100 and end up at $30.00 then to me that’s negotiation. Don’t burst my bubble ??️.
My daughter was in demand so maybe a hook per se.
For my engineering son we noticed, as you pointed out, that moving down the ranking food chain 1/2 merit scholarships were more common. Plus there are some great colleges that we would of never known about if we didn’t look. I agree. People are stuck on rankings or prestige. Then they complain when they can’t afford it. With 2 in college currently, all I can say is that it sucks and that is with having a good amount of 529 money. Just found our file and we started when the kids were 6 year old.
Hopefully this all will end in a few years. We are getting there… Lol… ?

@austinmshauri One small U matched another one’s FA (mixed need and merit) for my S. They asked for a copy of the other offer and let me know they’d do it because they considered that other college a peer - they’d not match a public, for instance.

It was indeed a negotiation.

Agree.

If a college is having trouble actually filling their class, anything can happen regarding “negotiation.” It is a leap to assume that a lot of Universities are “negotiating” unless it is a business-like athletic award.

@packattack1018 I work in the higher Ed sector. I remember an experiment done by a client of mine (often mentioned on CC) a few years ago. They used the world ‘scholarship’ in a certain number of acceptance letters and ‘grant (not to be repaid)’ in others. They got a WAY bigger positive response from the ‘scholarship’ letters. I have to bite my tongue a lot when I hear parents brag about their kid’s scholarship. Especially when their kid goes to a school where not a single freshmen pays the sticker. Colleges work hard to build their brand so parents will be willing to accept a lower discount. Colleges are businesses. Every college knows exactly what it’s appropriate discount factor is. By the way, from 2017 to 2018, the average discount went up again by 2% to 52%.
The elite schools are in a different league. They are the only ones for which anyone is willing to pay sticker.

Why this silly game? Because parents believe, strongly, that higher prices schools are higher quality. With the number of students graduating HS declining now, this game is squeezing the non-elite private schools.

By the way, check out Grove City College in PA. They have the kind of tuition approach you are seeking.

I’ve seen the same game played in retail. A large discount store chain that is slowly liquidating all their stores would mark everything UP to full retail price, then announce the store was being closed and everything was XX% off. Nevermind that many items in the store were cheaper the day before the “sale” was announced. People would come in to buy it because it was marked down now! It’s really amazing and in some ways disheartening to see how naive people can be and how they get fooled. I’m trying to avoid being one of the sheep.