One year ago this month, I wrote about How We Have – and Haven’t – Saved Money on Our Daughter’s College Search. This is the second – and last – post on her college search – she has made a decision! Read on.
It’s been an intense 2-year process that seems more like 5 years. I’m not complaining though – I’ve loved (nearly) every minute of it. It has combined a few things that I enjoy:
- Travel – Pippa has visited 15+ colleges
- Being treated like royalty – the colleges really roll out the red carpet
- Seeing Pippa develop and discover who she is and what she wants to be
Your typical high school counselor might scoff, but going through this process makes me feel like an expert now. Following are eight of the things I’ve learned.
1. Getting into a Top College is Really Hard
As the New York Times noted in March, it’s harder than ever to get into a top college.
This is a trend that has been going on for decades. My dad wasn’t a top student growing up on Long Island, but he attended Cornell University no problem. His dad and uncle both went there, as had other relatives, so it was unthinkable to deny him admission then.
When I applied to Cornell in 1990, I was wait-listed, despite being a pretty good student. Today, I would be denied outright, I’m sure.
Here are some of the top contributors to college admissions getting more difficult:
- More international applicants who can pay full freight, especially from China
- Students are applying to more colleges
- There is the feeling among many that the college you attend determines your future, leading to monumental efforts (like intensive test prep) to gain admission
I don’t buy that last one. I know too many community college grads who are high achievers. It’s really more about taking advantage of opportunities.
Notice I don’t mention bribing tennis coaches, or legacy issues, or funding the new science building as a reason why there are fewer spots at top colleges. That’s because bribing and standardized test cheating is exceedingly rare despite the recent episode, and while legacy and philanthropic admissions occurs, it is less common than ever.
2. Rankings Have Their Place but They Aren’t the Most Important Thing
My uncle went to MIT for a year and was miserable. He transferred to a less prestigious school, and felt right at home.
My brother went to a small Christian school (Geneva College) not known for its academic prowess, and he was deliriously happy there. And he received a solid mechanical engineering education.
It’s all about finding the right fit for the student, and how engaged the student is at that college.
Beyond these anecdotal experiences, I’m generally suspicious of rankings. They are partially based (22% for U.S. News & World Report) on the school’s ‘reputation’ among guidance counselors and competitor schools, whatever that means.
You know what is a better indicator of rank than U.S. News? How accommodating they are. If they lavish you with snacks and a school t-shirt and a lunch pass, their marketing budget might exceed their professor salaries. At Swarthmore College, we checked in with Admissions and I tried to find the coffee. When I asked, I was directed to a cafe (in another building!). This must be a top-5 school, I think to myself.
3. Early Decision Isn’t As Scary As I Thought
Pippa is a good student, yet she wasn’t a lock for a top college, because she hasn’t started a non-profit to house homeless veterans, or discovered a new celestial object, or cured any type of blood cancer.
We talked about it and she decided she wanted to try for a reach school, and thought an early decision (ED) application would be her best shot. ED accept rates are much higher than regular decision rates.
Initially I was nervous about the ED route, because you are contractually committed to attend if you get in. There is reportedly some escape valve if the financing isn’t sufficient, but I think that’s hard to exercise ethically.
Would we be equally rejoicing and in mourning if she got in ED, if the financial commitment was more than we thought? Turns out, you can remove a lot of the guesswork ahead of time. Most colleges have a financial aid calculator on their site that gives you a pretty accurate picture of what you will pay, based on your FAFSA and CSS Profile.
Another ED hedge of sorts is to apply to one of only about 20 schools that provides 100% of demonstrated financial need without any loans.
4. It’s Uncomfortably Tight Here in the Middle!
From a financial aid perspective, middle class families get squeezed. The poverty-stricken often get free (or greatly-reduced) rides, and the wealthy happily pay full ticket.
We experienced this. Of the 5 schools Pippa was granted admission to, we received $0 in need-based financial aid. Unless you put loans ($5,500/yr) and work study (earning potential: $2,500/yr) in that category. Full disclosure: She would have received some need-based aid if she hadn’t received merit scholarships.
Pippa has a younger brother; he’s cute but he’s of no financial benefit until he enters college (fingers crossed) in two years. According to one of Pippa’s colleges, she will get a $14,140 boost in need-based aid when he starts college.
5. Look for Colleges that Offer Scholarships…And Then Find More Scholarships
Nothing beats money that never needs to be repaid. Nora works in a high school, so she directed Pippa to this site, which details schools that offer merit scholarships for strong students.
If you are an exceptional student, you can find a college that will give you a full ride scholarship. But it won’t be a top school. There is a strong inverse relationship between school reputation and merit scholarship availability.
That said, there are a lot of good-to-great schools that offer merit money, and that is mostly where Pippa concentrated her efforts. Of the 5 schools she gained admission to, she received an average of $25,583 per year in merit aid, not including loans or work study. That’s real dinero!
But wait! There’s more! Once you lock in a school’s financial package, there are lots of independent scholarships to be had. Pippa applied for credit union and utility industry scholarships, and is waiting to hear back.
These tend to be small ($1,000 is a popular amount) but can add up quickly. And they tend to be less competitive. The Dave Ramsey school of college financing says that students should make it their full-time job to pursue these grants.
6. Make Sure Your Student Has Skin in the Game
It’s tempting to make things easy for your student, if you are able. I’ve heard the arguments:
- “Their studies should be their full-time job.”
- “College graduates have enough challenges – they shouldn’t be burdened with loans as well”
That’s crazy talk. Sign ’em up for the loans and work study. Every bit helps, and it’s good for them.
Ten hours a week of work study isn’t going to keep anyone from making dean’s list. In fact, students who do work study actually get better grades than those who don’t. And they develop discipline and something to put on their resume.
And maybe something more. Nora won ‘Student Employee of the Year’ at Bates, and 25 years later, still visits her old boss (now retired) every year or two.
Positive work relationships aside, it’s really about giving some ownership to the student, so she feels like a contributing member of her own education.
7. Negotiate Smartly
It pays to know when and how to negotiate:
- Street market in Mexico City? Yes!
- Walmart checkout line? Good luck with that.
- CarMax? Ummm, no – I think you missed the memo on that.
- College tuition? Yes, if you do your homework.
Most colleges don’t have the ability to increase an aid package without new information (job loss, family sickness, etc.), but there is some opportunity on the margins. For example, only one of Pippa’s schools formally offered work study, but you can be sure that we would ask for that commitment from the school she chose.
I’m sure there are other opportunities. It doesn’t hurt to ask, according to this interview with Macalester College’s director of financial aid:
Families who are wondering whether to ask questions about financial aid should know: You will not be the first or the last to do so. A parent of a student who asks for more aid needs to be ready to hear ‘no,’ but there’s no reward for silence.
8. Start Earlier than We Did
We started the college search early, and Pippa started the good-grades-getting and the SAT prep early, but we started the financial stuff too late.
We didn’t start contributing to a tax-advantaged 529 plan until August 2013, and then only $500 a month ($250 per kid), so each fund is still south of $20,000.
Even worse, we didn’t get educated early enough, causing us to potentially miss out on some opportunities. I didn’t realize until recently that:
- 529 contributions are deductible in Maryland (but not on the federal 1040)
- For students, it’s the assets (20% hit!) that matter most, not the income (there’s an exemption on the first $6,660 and work study doesn’t count)
- For parents, it’s the income (22-47% after a relatively small exemption) that matters most, not the assets (2.6-5.6%)
- Calculations are based on the ‘prior-prior’ year (this is new), so outside gifts (from grandparents or wherever) are best left for junior year of college or later
- Retirement, cars and home don’t count, but they might on the supplemental CSS profile that some colleges use
These are just a few high-level points – it’s way more complicated than this. Yet another reason to start early.
Enough with the lessons, here’s what you’ve been waiting for: Pippa will be attending College of Wooster in September! Go Fighting Scots!