Princeton list price is about $91k (first two years) or $93k (last two years) with tuition being $65k of that.
So if your example with $200k parent income gives a net price of $13k, then Princeton is offering $78-80k of grants, which is more than the $65k tuition.
Probably it meant that Princeton was already that generous, and decided to make an announcement on that, without becoming even more generous. Of course, getting admitted is the hard part, and it is much easier to gain the necessarily admission credentials to get admitted to Princeton from a high resource environment (about 40% of Princeton undergraduates do not get any financial aid grants, and some of those who do are getting lower amounts; Pell grant students are, as expected, under-represented at 19%).
I also ran Princeton’s NPC with $250,000 AGI, $10000 savings, with no other assets nor income; this fictitious family would have received a grant of $65730 (NPC uses $65210 as tuition costs) and is expected to contribute $25000 to an estimated COA of $90730. This is consistent with ‘free tuition for the 250000 and below’.
The cynical but probably true answer is that they have looked at the statistics and they accept so few students in this category that they can afford it. If you look at Wake’s CDS, they have been stingy for years. Yet they don’t have trouble filling their classes. There are a lot of millionaires now, and they have the resources to produce smart kids.
I see the problem. I entered the untaxed income incorrectly. With the inputs fixed and untaxed income = 10% of AGI, the totals change to the following. Assuming parents have no assets is obviously not realistic. If parents have non-retirement, non-primary home assets above $175k, net cost increases by 5% of amount over $175k.
This is obviously superior FA to Harvard or any other similar Ivy+ type college I am aware of that is not free. It’s not shocking that Princeton would lead in FA, as Princeton has the highest endowment per student – approximately $4 million per student. Tuition revenue is minuscule compared to investment returns on endowment, in a typical year. IPEDS information from a previous post I wrote is below:
$500k AGI – Net Price = $92k/year (sticker)
$450k AGI – Net Price = $86k/year
$400k AGI – Net Price = $72.5k/year
$350k AGI – Net Price = $59k/year
$300k AGI – Net Price = $45k/year
$250k AGI – Net Price = $31k/year (similar to no tuition)
$200k AGI – Net Price = $17.5k/year
$150k AGI – Net Price = $4k/year
$100k AGI – Net Price = $0k/year
Princeton Revenue per FTE Student in 2021
Investment Returns – $1.51M (95% of revenue)
Private Gifts – $49k (3% of revenue)
Government Grants – $16k (1% of revenue)
Tuition + Fees – $13k (1% of revenue)
Other – $6k (~0% of revenue)
This really isn’t all that new for Princeton and various other well endowed colleges, all of whom began a heavy emphasis on expanding need-based aid decades ago. Growth of the endowments has helped.
The only other school I’m aware of with a 250k threshold income level is St. Olaf, which guarantees a minimum grant of 45k for families with incomes of 160k-250k. The total billed cost (excluding travel, personal expenses, etc.) is 77k, so that’s a net price of 32k for the 250k family. “Typical asset” threshold there is <200k assets excluding primary home and retirement, per my conversation with a fin aid rep. So it’s not truly free tuition at that income level, but reasonably close. Also, note that these threshold guarantees are not always reflected in their NPC, which I’m told is not sophisticated enough to apply that filter.
As others have said, a college’s “typical assets” threshold isn’t usually published with the free tuition offer, and this can make a significant difference. I know that Colby’s asset threshold for its 200k income free tuition program is 500k including all home equity, which likely rules out some otherwise qualified students. A college could theoretically adjust this lever until the qualifying student pool included whatever target number the program can afford to help.
I’m going to guess that is not so theoretical. Meaning I think these colleges do fairly sophisticated projected budget-impact analyses of their aid formulas, and make sure the details support their overall budget plan.
While I agree that colleges do sophisticated budget analysis, I’d be surprised if they manipulate this lever within a class year. Meaning, I’d think they’d set a typical assets number for $200k for the admissions year and apply that for the year, then reassess all of it for the following year. I’d think it would be pretty sketchy to assert typical assets for a given salary varies by applicant or even by admissions group. Not saying a school or schools couldn’t do something questionable like this, but absent evidence of such practices I’d assume they would use other more legitimate ways to ensure a balanced budget than hoodwinking the small percentage of families that fit into this income range who they are trying to attract by marketing this feature. Especially since most, if not all of the schools offering this are incredibly well resourced.
“Free tuition” for income of under $200k (or $250k) is good for marketing. However, net cost can still be quite substantial. Most of the colleges mentioned in this thread are a little over $90k net price, with a little over $60k tuition; so “free tuition” means <= $30k net cost. If you instead phrase it as which colleges are <= $30k net cost for an income of $200k (or $250k), the list is much larger. Hundreds of colleges are likely to meet that criteria including many quality flagships (in state) and quality private colleges.
Examples include University of Florida ($6k tuition, $24k net cost), UNC: Chapel Hill ($7k tuition, $28k net cost), Pomona (NPC shows $27k for $200k income with low assets, but does not market as “free tuition” for $200k income), Berea (all students receive scholarship equivalent to no tuition, net cost is under $20k), etc.
I don’t disagree with your point that many state flagships will cost $30k or less.
However, it’s worth mentioning that the vast majority of college students do not come from families earning $200k or more. Most of those students would pay significantly less at an HYPSM-type school with generous need-based aid than the list price of their in-state flagship.
I think these published thresholds are intended to build awareness of how expansive need-based aid can be at many of these schools and to motivate people to use the NPCs. I started seeing this technique back in the 90s when aid really started ramping up, though it might have been used prior to that. In any case, every time Harvard or Stanford or Princeton publicizes a threshold like this there are news reports and more people realize that one doesn’t need to be “poor” to get great aid. I’ve seen this with acquaintances who wouldn’t have dreamed of filling out an NPC at Stanford but did so based on a news report of tuition free at incomes under X.
Totally agree with you. A big value of them marketing no tuition at $200k is that it gets people to consider those schools. In state flagship most families in the $150k-$200k who are considering college already know those are reputed to be good value and plan to apply. The number of times I’ve had convos with people who said their smart kid can only apply to UC or CSU when I have to persuade them that Stanford may be equivalent or even cheaper is way too often. And these are middle class people.
Completely agree. I think once they refresh their NPC for a cycle, that formula is more or less locked in for that cycle. I was intending only to refer to the process of deciding what changes to make for upcoming future cycles.