Six figure income parents looking for scholarships?





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Discus: Parents Forum: 2004 Archive - Part 2: Six figure income parents looking for scholarships?
By Dke (Dke) on Saturday, September 18, 2004 - 11:18 am: Edit

The older my kids get, the more I seem to run into parents who have very good incomes, but somehow along way, "forgot" to save for their kids' college education....lavish vacations, new cars every year, large homes and no college savings.....are the offspring of people like this eligible for scholarships? I can tell by talking to these parents that they are very much counting on someone else picking up the tab for their childrens' educations....will that happen?

By Dke (Dke) on Saturday, September 18, 2004 - 11:23 am: Edit

sorry, this posted twice by mistake!

By Vigo (Vigo) on Saturday, September 18, 2004 - 12:09 pm: Edit

I don't think there is anything wrong with a kid getting a merit scholarship, regardless of his parents' income. He worked for it, he should be equally as entitled to it as the kid whose family earns $25,000 a year.

If you're referring to federal aid, the kid wouldn't qualify anyway unless the parents fudged the info on the FAFSA.

By Emeraldkity4 (Emeraldkity4) on Saturday, September 18, 2004 - 12:29 pm: Edit

I also don't think there is anything wrong with merit aid, after all the student earned that.
However I admit that it does rub me the wrong way when I see students recieving aid to schools that supposedly are need based only as most competitive schools are, and I wonder if the school is really that generous to families with (3 new cars, recent top to bottom remodel and several vacations a year) or if the family thought to fudge a little on application.

By Lamom (Lamom) on Saturday, September 18, 2004 - 01:01 pm: Edit

Son received merit aid and we are very grateful. We did hope for merit air but we knew that it was not a given. We were prepared. One of his son's friends had rec'd an alumni scholarship w/o the money because "parents made too much" just a few yrs ago. I have run into families that had counted on aid because they did not or could not save or they believed others who said their child would get a full ride anywhere. I think this was a gamble-most of them lost.

By Thumper1 (Thumper1) on Saturday, September 18, 2004 - 01:05 pm: Edit

>> if the family thought to fudge a little on application.>>

It's not worth "fudging" on the FAFSA. There is the risk of review, loss of aid, loss of admission to the university. It's a federal document which many schools ask to be supported by tax returns for two years. Don't lie on it...not even a little.

I agree that merit aid should be awarded to those who have earned it regardless of income.

By Frazzled_One (Frazzled_One) on Saturday, September 18, 2004 - 01:22 pm: Edit

"are the offspring of people like this eligible for scholarships?"

Do you mean merit scholarships? If so, I certainly hope those kids are eligible - I can't see how it could in any way be the offspring's fault if their parents are selfish, foolish, or irresponsible. If the kid qualifies for merit scholarships under whatever criteria are set, then he/she should certainly be eligible to receive them.

Though I live in an affluent community, I don't think I know anyone who is counting on others to pick up the tabs for their kids' college expenses while they take lavish vacations, buy new cars each year, etc. The folks in our community with such spendthrift lifestyles either really can afford their EFC or expect to borrow to meet it.

I know many who experience sticker shock when the reality of college financing hits home, and some who set a spending limit well under the EFC, leaving the difference to be met via loans, less expensive schools, or merit scholarships. I don't see anything wrong with this approach provided the kid understands the financial limits when starting the college search. It's not easy to have $120K in the bank when each college-bound kid turns 18, even if all vacations have been at Grandma's.

If you're referring to need-based aid - it's hard to see how high-income parents can expect much from that route, since even moderate-income parents are extremely hard pressed to meet their EFC. It can be hard to judge a family's financial situation all that well from externals - are one or more of the new cars company cars, or were they provided by grandparents? Were the lavish vacations part of a compensation package for top performers? Of course, these folks may also be high-spending boobs who truly have never saved a cent for anything. But I don't think that "oops - we spent it!" cuts much ice in the financial aid office.

By Northstarmom (Northstarmom) on Saturday, September 18, 2004 - 01:29 pm: Edit

It will happen if their kids have grades, scores or ECs that are attractive to colleges offering merit scholarships. Of course, the kids also would need to apply to such colleges.

By Patient (Patient) on Saturday, September 18, 2004 - 04:07 pm: Edit

I know one extremely wealthy family around here whose child is a recruited, scholarship athlete at a major Pac-10 school. For what it's worth, I am imagining that the family will be giving back to the school many times over the amount of the scholarship, in donations.

By Dmd77 (Dmd77) on Saturday, September 18, 2004 - 04:19 pm: Edit

It is certainly possible to manipulate income and assets to make the FAFSA look better. Other FAFSA discussions have certainly pointed out numerous ways that parents--esp parents with their own businesses--can reduce their visible income.

Here are some key facts: 5% of retirement funds and other such parental assets are counted as an asset (per year); 35% of funds in the student's name. For many schools, the primary residence and one (sometimes two) cars don't count as an asset. SO: don't put money in the kid's name; have a big expensive house with a big expensive mortgage, because that reduces available income; reduce your income for the base year by moving income into the prior year or the next year; and have one expensive car.

When an acquaintance was laid off in December of the year before the relevant year, she took the severance as a lump sum, to reduce her income for the year, then didn't even look for another job for months. Her income for that year was so low that her son got full scholarships. Of course, she'd made 6-figure incomes for years before that--and is now doing so again....

Is this legal? Sure. I'll let you judge the ethics of it all for yourself.

By Patsfan (Patsfan) on Saturday, September 18, 2004 - 04:53 pm: Edit

I have a problem with the entire college financial aid system. Need-based financial aid is nothing more that charging different prices for the same product with no basis other than a family's financial situation. At least merit-based awards are supposed to give equal opportunity to everyone.

It's actually worse than the graduated income tax structure. Why is it that, in a country that frowns upon discrimination, colleges are allowed to do essentially what they want in the admissions process.

By Annieivy (Annieivy) on Saturday, September 18, 2004 - 05:07 pm: Edit

I actually think colleges should move away from merit based aid to provide aid to those who really need it. I am being recruited by schools that would give me full scholarships although my parents can afford to pay. My family was shocked when we learned this. It doesn't seem right.

By Marite (Marite) on Saturday, September 18, 2004 - 05:15 pm: Edit

Annie:

You sound so sweet! Take the offers as signs that you are valued. You don't need to take up the scholarships, but it's nice to know you are wanted. When next your classmates or their parents bring up your legacy status, you can mention those merit scholarships!.

By Dadx (Dadx) on Saturday, September 18, 2004 - 05:21 pm: Edit

Its no different than a business charging customers different prices for the same product. Usually when they do it, the higher payers get a little more for it.

As for six figure families receiving financial aid, at both H and P, there is info available on the websites that shows a pretty good breakdown of the fact that hundreds of families with those incomes receive aid at those schools.

By the way, don't take the comments of "I don't know how were going to pay for it" too seriously (unless they dwell on it). I might (and do) say that if I feel I'm in company with people who would resent (or feel diminished by) the fact that we can pay for it.

By Marite (Marite) on Saturday, September 18, 2004 - 05:29 pm: Edit

>>Usually when they do it, the higher payers get a little more for it.>>

Not universally true. This is where the analogy with airfare comes in. On another thread, Latetoschool has a post describing how her D, through a series of miscommunications, ended up paying $1400 for a roundtrip that should have cost $250.

By Momsdream (Momsdream) on Saturday, September 18, 2004 - 05:32 pm: Edit

Six figures is a very subjective phrase..

This could represent everyone form $100k (deserving much fin aid) to $999k (deserving none).

By Patsfan (Patsfan) on Saturday, September 18, 2004 - 06:36 pm: Edit

In college, you are paying a different price for the same product. If you get no financial aid, do you live in a better dorm, eat better food, taught by better professors? I don't think so.

It is unfair to charge one kid $40,000 and another $20,000 based solely on an artificial EFC.

By Marite (Marite) on Saturday, September 18, 2004 - 06:39 pm: Edit

Patsfan:

But isn't that exactly what airlines do? And believe me, I get charged more for living in an expensive zip code than someone else (but I've said so on CC before). Fair? No. Standard? Definitely.

By Patsfan (Patsfan) on Saturday, September 18, 2004 - 06:59 pm: Edit

Marite,

Airlines charge by location, type of ticket, dates traveled, ticket restrictions etc. Higher income does not mean higher ticket prices unless you want to travel first class for the dubious extra amenities.

I also pay more to live in my zipcode area. Does the EFC take this into account?

By Marite (Marite) on Saturday, September 18, 2004 - 08:03 pm: Edit

Quoting Patsfan:
>>In college, you are paying a different price for the same product.>>

The point is that, with airlines' pricing, whether you you paid $1400 or $250 (the different price), as in the case of Latetoschool's D, you get exactly the same seat (the product).

By Ellemenope (Ellemenope) on Saturday, September 18, 2004 - 09:50 pm: Edit

I've seen 6 figure income families receive substantial financial aid--but there has always been an extenuating circumstance. In this case, the family had 3 other kids in college and another 3 at home.

By Patsfan (Patsfan) on Saturday, September 18, 2004 - 11:00 pm: Edit

Marite,

The point is the price you pay for the airline ticket is based on when you buy it, your arrival and departure date, whether the ticket is coach, business, first class or restricted, etc. It is not based on your income or personal assets.

Different prices also occur in the purchase of other goods such as cars, items on sale etc.

The point is, if persons are paying full price without need-based financial aid, those persons are subsidizing the others.

By Marite (Marite) on Saturday, September 18, 2004 - 11:21 pm: Edit

Patsfan:

I was responding to your very specific point which I quoted. Nothing you have added alters this. And when I pay full price for an airline seat for which somebody has paid a tenth of the fare, I am also subsidizing that person. The fact that s/he purchased the fare under different conditions is neither here nor there. Same product, different prices. Isn't it what you were complaining about?

By Mini (Mini) on Saturday, September 18, 2004 - 11:38 pm: Edit

You likely wouldn't like a class full of full-fare customers.

Also, however, according to their articles of incorporation and original mission statement, you couldn't get into schools like Amherst, which was explicitly set up to serve indigent god-fearing young men, or Yale, set up for young men destined for the propagation of the Christian faith.

But NO ONE is a full-fare customer, at least at my alma mater. The cost of education per year per student is $65k. Every student, rich or poor, begins with a $23k scholarship, per year (or $92k for four years, more than I paid for my house) - paid for, you guessed it, by moi. You ALL get financial aid. Yup, I get to subsidize multi-millionaires' kids. Don't worry - I don't mind. It is my only hope of having multi-millionaires kids hobnob with kids like mine -- maybe they'll both learn a thing or two.

By Anglophile (Anglophile) on Sunday, September 19, 2004 - 04:08 pm: Edit

"I seem to run into parents who have very good incomes, but somehow along way, "forgot" to save for their kids' college education....lavish vacations, new cars every year, large homes and no college savings.....are the offspring of people like this eligible for scholarships? I can tell by talking to these parents that they are very much counting on someone else picking up the tab for their childrens' educations....will that happen?"

I have an answer for you based on my own experience. My Father fits your description perfectly: he bought a large house in LA, owns 4 cars- 1 is a very expensive SUV, just remodeled his kitchen (it looks like a mansion), and he just got a big bonus that he can't wait to invest in his back yard! Not to mention fulltime daycare, a weekly housecleaner, and investing in a new spa business with his sister-in-law. So, yes--he *could* pay. Do I see any of this money? NO. My parents are divorced, and my mom is unable to work, so I had to find a college that wouldn't look at the "noncustodial parent's income". Bye bye LACs, and HELLO UCLA.

I have scholarships and a very good financial aid package-- and my father is very pleased that someone else is picking up the tab. So, "are the offspring of these parents eligible for scholarships?"-- yes we are, I wouldn't be able to go to a university without them. "Will someone pick up the tabs for their education?"-- yes, the children pick up their own tabs eventually through the miracle of student loans. Should this happen? No. But I am so grateful that some colleges are sensitive to students in my situation.

By Mini (Mini) on Sunday, September 19, 2004 - 04:16 pm: Edit

"And when I pay full price for an airline seat for which somebody has paid a tenth of the fare, I am also subsidizing that person. The fact that s/he purchased the fare under different conditions is neither here nor there. Same product, different prices."

When you go to my alma mater, neither of you is subsidizing the other. The only question is how large a subsidy you are receiving....from me!

By Marite (Marite) on Sunday, September 19, 2004 - 04:36 pm: Edit

Mini:

Good point!

By Strick (Strick) on Sunday, September 19, 2004 - 08:19 pm: Edit

"I seem to run into parents who have very good incomes, but somehow along way, "forgot" to save for their kids' college education....lavish vacations, new cars every year, large homes and no college savings.....are the offspring of people like this eligible for scholarships? I can tell by talking to these parents that they are very much counting on someone else picking up the tab for their childrens' educations....will that happen?"

I have an answer for you based on my own experience. My Father fits your description perfectly: he bought a large house in LA, owns 4 cars- 1 is a very expensive SUV, just remodeled his kitchen (it looks like a mansion), and he just got a big bonus that he can't wait to invest in his back yard! Not to mention fulltime daycare, a weekly housecleaner, and investing in a new spa business with his sister-in-law. So, yes--he *could* pay. Do I see any of this money? NO. My parents are divorced, and my mom is unable to work, so I had to find a college that wouldn't look at the "noncustodial parent's income". Bye bye LACs, and HELLO UCLA.


Even with none of those expendatures (we're all but debt free with a couple of very used cars and a straight forward house), I'd have trouble sending all four of my kids to a top dollar school. There's that little thing beyond getting them through college, after all. Retirement.

I'll willing to put up half our savings, but no more. Fortunately my D did receive a full ride a few years ago and my S, who's a HS senior this year, looks good for some help.

Whatever the case, I've put a limit on how much we'll pay for school for each child. My S knows this and did before he picked the schools he's going to apply to. If he decides to go to a school that doesn't give him merit aid to make up the difference, I'll help him figure out how to get through, but I won't cover all of the $40,000+ of some of the schools he's going to apply to.

There is an upside. Any money he saves goes towards that graduate school he's already picked out.

By Songman (Songman) on Sunday, September 19, 2004 - 10:32 pm: Edit

I love these threads...they display the extent to how far people will go to rationalize their position. Let's face it folks, when it comes to fin aid for the needy ,etc, college is the the class equalizer. nevermind the fact (heaven forbid we mention it) that generations of people worked hard to get to the point where they can afford college. Colleges and society say we must help all...in its most idealistic form giving need based aid sounds great. In my life however, I have seen countless examples of family members and relatives that through their dysfunctional behavior and cavalier attitude regarding resonsibility for children, somehow their kids get the tuition bills paid by others, while the ones in our family who saved,worked hard and took responsibility pay the full freight. In the bigger scheme of things that is the redistribution of wealth. That is social engineering and goes against the grain of a capatalist system. Notice however that college is the only break that a smart neeedy kid can get from society. After college they are on their own,except they may graduate debt free while the middle class kid/parents has $50,000 in loans...

By Angstridden (Angstridden) on Sunday, September 19, 2004 - 10:45 pm: Edit

Mini if every kid starts with a $23000 scholarship isnt the price artificially inflated?
Sort of like the store that always has things at 50% off?
Soozviet, we saved alot for our D. and not knowing any better put it in her name. I was complaining on here once about the 35% assesment and got slammed because I was lucky enough to be able to afford to save where others couldnt!

By Northstarmom (Northstarmom) on Sunday, September 19, 2004 - 11:25 pm: Edit

My understanding is that every college student goes to college with a subsidy because no matter what parents are paying, a college education still costs more than the sticker price.

By Emeraldkity4 (Emeraldkity4) on Sunday, September 19, 2004 - 11:32 pm: Edit

right, our local prep schools are the same way, tuition only covers about 80%
as far as that goes although the public schools have considerably larger class sizes parents and teachers are still needed to fund raise quite a bit as well as purchase supplies.

By Mini (Mini) on Monday, September 20, 2004 - 12:26 am: Edit

" Mini if every kid starts with a $23000 scholarship isnt the price artificially inflated?
Sort of like the store that always has things at 50% off? "

No. The price is "deflated" because as part of its stated purposes as a "non-profit educational institution", the Board of Trustees at each institution has decided to subsidize the education of ALL the youth it accepts. You see, it isn't a store. The airline analogy by the Prez of Williams makes good economic sense, but not very smart educational sense (in my judgment.) And the truth of the matter, as the market shows, the highest price paid will continue to rise for those who can afford it, with more and more discounting for those who can't. (Yes, at some future, unforeseen point, the cost could hit the equivalent of $65k. But families who pay that will still not be subsidizing those receiving discounts - I WILL BE. Those who don't like it - well, tough (say the trustees at my alma mater, and me as well) - you can take your kids elsewhere. If you can buy a better education elsewhere, nothing stops you.

Now, for some institutions, this is backward, as noted. The mission of Amherst College was to educate indigent youth, not those who could afford to pay. Out of the goodness of their hearts, the trustees over time decided to take students from wealthier families. They didn't have to -- the endowment grew pretty quickly from the success of those formerly indigent students.

It is not different at state universities - in that case, the public at large subsidizes all students - there are NO "full-fare" customers. If someone doesn't like that, they can go elsewhere, too.

In the 18th and 19th century, in Europe (especially England), the rich did just that. The quality of education at Oxford ranged from the abysmal to the mediocre, and most of the wealthy really were not that interested in having their sons mix with that riff-raff. Private tutors and the Grand Tour were considered the way for the wealthy to get a good education. (Still could be! You could pal around, coast to coast, and continent to continent, with Paris Hilton!)

By Dannysmom (Dannysmom) on Monday, September 20, 2004 - 01:55 am: Edit

I agree songman. There seems to be a tremendous correlation between those who are well educated but need substantial financial aid for their children and those who believe someone else should pay more. At what point are those who have the benefit of a great education subject to seeking employment that will pay for an equal education for their offspring? Should parents be entitled to do whatever they want professionally and seek federal financial aid? Should they be able to qualify for financial aid if they spend much of their time posting on bulletin boards? Intellectual purity of purpose as opposed to providing for their kids what government and the wealthy they belittle provide?

By Voronwe (Voronwe) on Monday, September 20, 2004 - 04:30 am: Edit

Your analysis is correct, Mini, about the full cost of education being higher than tuition - however, I will say this. In one sense, saying so-called full freight payers "subsidize" the aid receivers is not incorrect.

Say my example school has 10 kids and needs $1,000 to run. I collect $200 from alumni etc.
Now I need $800 in tuition, or $80 from each kid.

But I decide that 5 kids should pay nothing at all. I still need $800, so where do I get it? From the other 5 kids. They now pay $160 instead of the $80 they WOULD have had to pay.

In THAT sense - within the tuition portion of the budget - the 5 paying kids ARE subsidizing the others, because their costs would have been $80 rather than $160, if each student paid the same.

[Edit]
One might also question the "real cost" of the education. My state U has a go-nowhere football team, yet pays the coach $1,000,000, a year. A school I volunteer for just paid a large fortune to decorate the President's office building while the dorms are squalid. These and others costs are part of the entire budget, but I would hesitate to say they are REALLY part of the cost of each student's education and hence he or she was getting a subsidy. Looking at my school's budget - the one where I volunteer - I see that if a number of non-education-related expenses were cut, the school would be making money from each student!

By Voronwe (Voronwe) on Monday, September 20, 2004 - 04:36 am: Edit

I could also imagine, Mini, that the fact that other alumni contributed to **your** education while you were in college means that in a sense, you are not subisidizing anyone now - you are merely "paying back" that $23,000 a year for four years (or whatever it was when you went) that you received.....almost like a loan, albeit a voluntary-repayment one!

:-)

By Frazzled_One (Frazzled_One) on Monday, September 20, 2004 - 06:44 am: Edit

"Should they be able to qualify for financial aid if they spend much of their time posting on bulletin boards?"

Is the point that some parents who can't pay full freight are in that situation because they spend too much time online? Couldn't it be that some of those well-educated folks who need substantial financial aid for their children are teachers, nurses, and other middle income professionals I wouldn't like my community to exist without? Need-based financial aid, while not a perfect system, at least provides the possibility of an equal education for all (hence the word "equal"), not merely those kids lucky enough to be born into wealthy families.

"Intellectual purity of purpose as opposed to providing for their kids what government and the wealthy they belittle provide?"

Wondering - would you feel differently if they spent much of their time posting on bulletin boards in praise of the wealthy instead?

By Marite (Marite) on Monday, September 20, 2004 - 06:48 am: Edit

A lot of these discussions conflate the students and their parents. When thinking about this issue, we need to distinguish kids from their parents. We need only read some of the students' posts to know that parents can make some very unwise choices, like buying cars that cost more than a full year's tuition, room and board at the most expensive college. But several posters have divorced parents, with the high-income earner refusing to support his or her child. One poster's D was denied aid at BC because BC felt that the divorced dad ought to pay for her college education, whether he was willing or not (he was not).

By Dannysmom (Dannysmom) on Monday, September 20, 2004 - 08:58 am: Edit

Frazzled, take a look at the times of day many of the people who practically live on this board post. Day and night. These are not teachers or nurses nor are they people who are working long hours to pay their kids' way. There is an attitude of entitlement. Federal dollars flowing for the disadvantaged, in this case the seemingly disadvantaged kids of people who admit going to top colleges! What sense does it make? I hardly defend the wealthy and I think they should be made to pay full freight. I'm not wealthy and I do. I also appreciate that it is the wealthy who are subsidizing my children if you want to believe in subsidies. They have built the buildings and provided faculty chairs. But I resent those who haven't saved, live high off the hog and have hours a day to post messeges while I slave away to pay my kid's way.

By Rhonda63 (Rhonda63) on Monday, September 20, 2004 - 09:11 am: Edit

Dmd -- I didn't read all the posts, so forgive me if you've already answered this.

Your friend who took the lump sum and is now making a high salary again -- doesn't the scholarship require new finaid apps every year? and if circumstances change, if this is a need-based scholarship, couldn't the son lose it?

i thought that's how need-based aid usually works -- you have to reapply each year, and if circs change (for better or worse), amt is adjusted.

By Frazzled_One (Frazzled_One) on Monday, September 20, 2004 - 09:46 am: Edit

Dannysmom, I'm always a bit leery of criticizing others for being online too much - I mean, I'm online too, aren't I? I'm also mindful of the fact that I don't know what others' work schedules might be, whether they work from home, are caring for young children or an older relative, etc. And aren't the times posted EST? Our West Coast or international posters may well be posting during their free time after slaving away themselves.

Don't really know anyone who meets your description of "those who haven't saved, live high off the hog and have hours a day to post messeges." I'm now off to do my own bit of slaving, but hope to read many of those excessive posts when I return.

By Mini (Mini) on Monday, September 20, 2004 - 11:30 am: Edit

"Your analysis is correct, Mini, about the full cost of education being higher than tuition - however, I will say this. In one sense, saying so-called full freight payers "subsidize" the aid receivers is not incorrect."

But, you see, that's the problem with the purely economic "airline" analogy provided by the President of Williams. The trustees have determined that lower-paying customers provide something to the entire educational experience -- including to the higher paying customers -- that wouldn't exist otherwise on a campus of only full-fare customers. It could be specific things like oboe players, or football players, or folks with an incredible amount of academic drive or desire. It could be something less concrete, like diversity in classroom conversation, or worldly experience to be shared outside of the classroom (would John Kerry and George Bush would have had more of it! Their Yale educations failed them mightily, I think.) Or it could simply be "face" diversity (which, unfortunately, it often is) because this pleases the trustees.

So, instead of thinking of it as the full-fare customers subsidizing the higher discount ones (I don't agree with your economic analysis, but we've been through that already), think of it as the trustees buying quality for the institution that they can't get through the limit range of skills, temperments, and experience offered by those from higher income families. And without the trustees buying those qualities, the quality of education for the full-fare customers would simply be poorer as a result (and, in my judgment and experience, actually is poorer when they don't invest enough.)

By Originaloog (Originaloog) on Monday, September 20, 2004 - 11:50 am: Edit

We can probably be classified as "well off" parents though it doesn't seem so to our family. However, early on we did created a college fund for our son whih grew to about $76k by the time he graduated.

With that money in hand we held him resposible for tuition, academic fees and books. He chose to fo for merit scholarships, did mucho research and ended up at RPI wiht nearly a tuition free merit aid package.

It took lots of work, but the four year $100k offer paid his efforts off very well. No need to cheat. Sure, he needed to make some ompromises. A close friend applied and is going to Cornell which was not an option for him. He absolutely loved his visit to Oberlin but the lack if merit aid made attending an impossibility. Another friend attends Amherst. While that would have been a bit of a reach for him, the merit aid considerations made his choice an easy one.

Could we have let him apply to anywhere he wanted? Of course. But we decided that he is now an adult, albeit a young one, and that it was time he began to learn that life is filled with difficult choices.

BTW, he has loved his first four weeks at RPI and it is hard to imagine him measurably happier anywhere else.

By Rhonda63 (Rhonda63) on Monday, September 20, 2004 - 12:07 pm: Edit

Orig -- I must be missing something. Are you saying that you had saved up $76K (almost two years tuition) but decided not to make it available to your son for his education?

By Cangel (Cangel) on Monday, September 20, 2004 - 12:35 pm: Edit

I'm sorry, I don't see anything wrong with merit aid for those who have sufficient merit. If my child was a gifted cellist, or great football player, should he or she not be recruited and receive a college scholarship because I can pay?

I don't see anything wrong with the approach we took - go to the state univ, and we'll bank 3 years of private school tuition for you. Our daughter turned us down, which from a pragmatic, adult point of view could well be a mistake. The right choice for her is not a 20,000 student university where only 25% of the students live on campus. She understands that resources for grad school, down payment on a house, etc,etc will be severely limited because she's using up her "inheritance" on undergrad. An alternative for her is to go to a LAC that gives her merit aid - while banking the tuition is now off the table, anything we are saved will increase the help we can give her later.

This is not about how much we can pay - we certainly will get no need based aid, unless we go for weeks with no business because of Ivan. We are willing to pay what it takes for her to go to the school of her choice, but we are not close to being so wealthy that $160K won't impact our retirement and lifestyle. Since it does impact our whole family, she does have a little brother after all, we thought it important for her to understand the implications of her college choice, and have some responsiblity for the decision making. Now I don't believe for a moment that she truly understands the implications of her choice, but even if the situation is somewhat artificial, she has to live with it.

By Rocketman (Rocketman) on Monday, September 20, 2004 - 01:12 pm: Edit

What is the situation for parents with so called six figure incomes (barely scraping into that category) who have been saving and may just have enough to pay for that IVY league college but not enough in their retirement savings to tide them over that hump. Is there any allowance given for savings for retirement? Or for mortgage payment etc. What about allowance for savings for another child not yet in college, but who will be after more than 4 years?

By Voronwe (Voronwe) on Monday, September 20, 2004 - 01:17 pm: Edit

Mini, you may be surprised that I even agree with and fully support your view that the lower-income students provide value (whether it is a talent, diversity, etc). So do the upper class kids - they each have their own talent, diversity in terms of their own experiences (e.g. my son's experiences are radically different from many of his equally affluent friends). We would be hard pressed to argue that the affluent kids - some of whom may be accomplished sailors, world travelers, have had parents famed in the Civil Rights movement, or whatever, are only on the RECEIVING end of value, and the low income kids only on the end of GIVING value! So all things being equal, there is nothing wrong with saying that in one sense one group does not subsidize the other, and in another sense, the use of the word is perfectly fine. Both uses of "subsidize" have merit, although the purely economic one is far more common.

I am agreeing with you about value added, but economically, if the university needs to get X amount under "tuition," then if one pays less, another pays more. I know this as a fact from 8 years on the board of a private school, in which we set each year's tuition in PRECISELY this way - took the total budget, subtracted endowment income, alumni giving, etc., came up with a figure for tuition and divided by the number of students.....THEN did it again, subtracting the students who needed financial aid, and raising the price on the others. My sister does the same analysis at the small private college where she works, and my best friend's spouse, who works at an Ivy, bears this up.

By Mini (Mini) on Monday, September 20, 2004 - 01:32 pm: Edit

Ah, but in your first paragraph, it seems you missed my point entirely. No one argues that full-fare customers don't offer some value to the institution - only that, if you provide a $23k/year subsidy to each of them, they are relatively easy to get. (That's obvious, given selectivity, isn't it? At full freight - $65k/year - it might be more difficult, and my bet is that we will soon find out!) However, low-income, minority, oboe-playing, football-catching, academically intense first-generation minorities are much more difficult to find - you have to PAY THEM MORE in order to get them to attend. Don't think of it as subsidy - think of it as these students being able to provide a scarce commodity that the trustees have decided to purchase. Football teams pay quarterbacks more than offensive tackles - they both get paid, but the scarcity value of quarterbacks means that to get and keep them costs more. And the whole team (including the offensive tackles) benefit as a result.

At a place like my alma mater, the differences in offering a $23k subsidy vs. a $50k subsidy for under 10% of the student body (at Williams 9.7% are on Pell Grants) is pixie dust - pocket change. It hardly shows up in the equation - minor stockmarket trades in the endowment add up to much, much more. Now there are schools like Smith, Occidental, and now Amherst where they've made "purchasing" such students a priority - so they may end up (someday) asking interesting questions like - "Which is worth more to the institution - purchasing 5% more low-income academically intense oboe players from inner city Detroit, or adding an associate professor in Political Science?" At that level, the questions become interesting.

But at the level of more highly subsidized students at places like Yale or Williams or Princeton, they never have to bother even to get that far. And the reason for that is this: these are decisions made in the so-called "need-blind" (doesn't exist) admissions office, not in the financial aid one.

By Dadx (Dadx) on Monday, September 20, 2004 - 01:33 pm: Edit

I am sorry (a little, at least) to be a boor about this, but don't ask the pundits on this board factual questions that can be anwered by going to the horses mouth.

Go use the Princeton Fin aid estimator as a first look at your situations. Do it with the knowledge that Princeton is the richest school in the country and possibly the most generous with financial aid. Other schools may offer less, but the top ten or so will perhaps only be slightly lower.

If you do, you will see that you can easily receive aid from them even if your income is in the six figure range. It is very possible that,from the lack of knowledge, upper middle class thrifty parents are unnecessarily limiting college choices for their kids.

By Songman (Songman) on Monday, September 20, 2004 - 02:26 pm: Edit

DADX said: If you do, you will see that you can easily receive aid from them even if your income is in the six figure range. It is very possible that,from the lack of knowledge, upper middle class thrifty parents are unnecessarily limiting college choices for their kids. ----------------------------------------------
I am sure there is some truth in what you have said without even going to the Princeton website. Although I took your advice and went to the website- My EFC was $3,000 lower than FAFSA stated. The Princeton survey is easier to fill out and more realistic. In our case we as parents did not do enough research and trusted the system.Dumb I know! The maximum we could afford, and that is pushing the pedal to the metal, is $20,000 per year! In every case except one school we were told we had an EFC that exceeded private college tuition.

I do not criticize the merit system at all. If your S/D qualifies for a merit award and you have $5 million in savings they should receive an award if they qualify. People who oppose this view also would say that Bill Gates should never be allowed to collect social security even though he pays into the system every year. What ticks me off is the same example I cited above: relatives and acquaintances that have worked the system due to society's soft social conscience which states that if you had to overcome obstacles( excuse me more like a lack of responsibility on the parents part) you will be rewarded. A friend of mine said to me last year when I got the EFC bad news "Of course we're all such fools, because we've all probably planned for paying for college
and actually saved some money - DUMB! Our kids won't qualify for aid because we're not poor enough and their lives have not been
tragic enough" Sure there are truly needy students out there that should not be held accountable for the dysfunctional environments they were born into, but the examples I have cited are the ones that sap the motivation and drive from others that planned and took responsibility for their children. I know, I know, so what else is new, these people will always be with us, but do we have to make it easy for them? :(


When it comes to college admissions, knowledge of the proper procedures to apply in order to achieve your goals ,is very important. The CC boards have taught me much and I will be a lot smarter next time around!

By Rhonda63 (Rhonda63) on Monday, September 20, 2004 - 02:51 pm: Edit

Sort of on topic -- I remember hearing that when Denzel Washington's son got an athletic scholarship to college (Morehouse? not sure if that's the right school), Denzel wanted his son to take it b/c he had earned it, even though of course they could pay full fare. However, the parents chose to pay tuition for 1 or 2 students with financial need as sort of a payback.

By Originaloog (Originaloog) on Monday, September 20, 2004 - 03:30 pm: Edit

Rhoda, I like that Denzel story. He always seemed like a classy guy to me and that proves it!

Re your questio about my prior post. The $76,000 is his to do with as he wants. We merely told him that he would be resposible for his tuition, books ans aademi fees. He ould use all $76k if he liked.

Beause our EFC was well above any college costs, he obviously couldn't afford to pay for 4 years at Cornell(where I earned my graduate degree) so it was never a option for him. With the exception of Oberlin, he was offered sizable merit scholarships at the other 6 colleges he applied to and could have paid the tuition/books/fees out of his savings. He should have more than $50k remainig upon graduation from RPI(my wife's alma mater). That was his choice.

By Thedad (Thedad) on Monday, September 20, 2004 - 11:01 pm: Edit

Footnote: some of us spend time on line not because we are wealthy but because we are self-employed with wildly variable schedules. There are days I can check CC ten times a day; there are weeks where I can barely manage one quick pass per day.

By Robyrm (Robyrm) on Tuesday, September 21, 2004 - 10:03 am: Edit

Just thought I would share something about college costs which my very wise mother-in-law told me when we started saving for our children 18 years ago.

She said "Just imagine as you write the tuition/room/board check for a year at a private college that is the equivalent of driving a new Cadillac off a cliff each year."

She was right then, I would guess she is right now.. though I am not in the market for a Cadillac (what with driving 2 off cliffs each year for the next 3 years!)

By Dmd77 (Dmd77) on Tuesday, September 21, 2004 - 10:16 am: Edit

That's quite an image. I picture two cars off a cliff, every year for the four years... and they're only sophomores right now, so we've only thrown three of them... five more to go!

But you know, it's not the same. I can't imagine my children being able to do what they want without the college degree--so it seems more like I'd be throwing the kids into the ocean without a boat... if I didn't spend the money.

Good thing we started saving when they were born.

By Emeraldkity4 (Emeraldkity4) on Tuesday, September 21, 2004 - 10:20 am: Edit

I try not to think of it like that, but with the combination of cutting hours back so they could be in co-ops and enrolling in private school for many years, we could probably have rolled a few jaguars off the cliff but that image is just too painful!

By Rhonda63 (Rhonda63) on Tuesday, September 21, 2004 - 10:21 am: Edit

Dmd -- I agree with you. Someone told me the "car off a cliff" analogy, too, and that was exactly my reaction -- it's different b/c this is an investment in your child's future, so it's not a waste at all (which is what the car/cliff analogy suggests to me).

We started saving pretty late, probably when she was about 8, but saved very aggressively (and having to fund only one college education helps).

By Songman (Songman) on Tuesday, September 21, 2004 - 10:42 am: Edit

Origin. -Smart plan. When my wife and I got married my in- laws said: have a large wedding and that is all you will get. Have a small wedding and we will give you $10,000. We chose the large wedding having no clue as to how expensive a family and life in general can be naturally. Hmmmmm $10,000 invested for 24 years at 12%(S&P 500 return without divs reinvested) = $151,786. IPSO FACTO uh? That equals roughly 4 years of a private college tuition. Your plan was smart and worked out well. Even if he did not obtain merit awards he may have chosen a state school and pocketed the rest. He would still have a leg up by the fact that he would graduate with some money. A heck of a lot more than other students can claim.

By Dmd77 (Dmd77) on Tuesday, September 21, 2004 - 10:42 am: Edit

Another way to think of it occurs to me: you could have 4 relatively new, pretty expensive cars in the front yard and a HS graduate complaining about his job at MacDonald's. Or you could have one well-educated kid in the kitchen, showing you her/his diploma and telling you about the job (s)he's starting next week.


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