Are top private colleges mainly for poor people now?

[Anonymous]

Maybe college should be a sliding scale all the way to the top? So we don’t cap it at the doughnut hole families. Someone making $700,000/year might be expected to pay $260,000 or even more per year. Wouldn’t that be more equitable?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The opposite is true,

according to the new research by Stanford economist Raj Chetty and co-authors.They show that 14.5% of students in America’s elite universities (eight Ivy League colleges, University of Chicago, Stanford, MIT, and Duke) are from families in the top 1% of income distribution, compared with only 3.8% from the bottom quintile. That’s a dramatic overrepresentation of the richest Americans.

But think about it. We are talking about a 320k education. Why would the very poor and the very rich be equally represented? Also there are many moor poor people than very rich people so while very rich people are of course over represented they seem to be very much outnumbered by lower income people on campus.

What are you talking about? Op is only referring to "top" colleges. These places are need blind and have endowments in the billions. Affluent students are way overrepresented. Spend a week at a top college and see how many poor kids you can find. Good luck.

Much easier to have the "resume" to get admitted to an elite university if you grew up privileged. The "poor" might attend schools with only a few AP courses if any, they did not have Kumon starting when they were 3, did not have tutors thru MS/HS or a college counselor or individual SAT test prep at $100+/hr. The list goes on and on. There is a dichotomy between what the privileged have growing up vs others. The non-affluent with the top test scores and gpa may not be able to even apply to an elite university because they are worried about affording it (transportation, books, spending $$, etc) so they apply to the local state U or do CC.
Basically, there are many more affluent people applying than non-affluent/poor.

[Anonymous]

Anonymous wrote:Often 2/3 of students at top ranked schools are getting need based aid that covers the vast majority of costs, on average.

200k is the typical cut off for need based aid (about the income level of a couple of school teachers at the peak of their careers aka “the wealthy”)

It just seems these schools must be populated primarily with lower income kids and then 1/3 rich kids.

I guess middle class kids end up at state school.

No, the middle class of the country goes from 65-160k. So most of the kids are middle class or lower class. That reflects the population as a whole, although in fact upper income kids should be less (20% vs 33%). It’s amazing how many people here actually secretly want a Russian style plutocracy. No wonder trump won.

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

[Anonymous]

Anonymous wrote:

Anonymous wrote:Often 2/3 of students at top ranked schools are getting need based aid that covers the vast majority of costs, on average.

200k is the typical cut off for need based aid (about the income level of a couple of school teachers at the peak of their careers aka “the wealthy”)

It just seems these schools must be populated primarily with lower income kids and then 1/3 rich kids.

I guess middle class kids end up at state school.

No, the middle class of the country goes from 65-160k. So most of the kids are middle class or lower class. That reflects the population as a whole, although in fact upper income kids should be less (20% vs 33%). It’s amazing how many people here actually secretly want a Russian style plutocracy. No wonder trump won.

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

You are missing the point, I think. The approach to pricing that we have now (kids under 150k get a full ride, otherwise you pay full price, more or less) reinforces plutocracy, as only the very affluent can really afford full price.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I didn’t know poor people make $150k or $100k.

Yeah, that's us, and I consider us middle class. Do the $200k+ people really think they are middle class? Maybe UMC at closest.

You must be one of those people posting from rural Kansas.

200K is middle class when the average house sells for 618K and 30 year mortgage rates are 7.2% and progressive federal and local taxes eat the first 40%+ of that income.

In the DC area, the upper band of MC is about $220K.

https://www.cnbc.com/2023/01/02/middle-class-income-in-major-us-cities.html

And $220K is not all that different from $250K after taxes, certainly not enough to pay for $80K/year tuition.

So you’re talking about families who have save nothing toward college tuition until their kid enrolls freshman year? I certainly agree that family cannot cash flow $80k COA.

Well, you are assuming that people make $200K/ year from when a kid is born, thus saving $$ per year. Most people don't start out making that much.

Our HHI is $200K. We max out our retirement because we are in our 50s and have no family money (and actually, I help my family financially).

We manage to save $20K per year for college for two kids in the past couple of years, But, we haven't been able to do that from when they were born, only in the past few years. Prior to that, we were saving $5k to $10k/yr. They have $130K each.

You'd have to have saved $320K total for each kid in order for you to afford private for both. That's an insane amount of money for people considered middle class in a high col.

Even at $10K/yr at birth, with a rate of 6% growth, that would be about $300K. And this is assuming $200K income 20 years ago.

But if you were only making $100K when your kid was born and are now making $200K, you could chosen to save majority of that extra income over the last 18 years as income increased. Even if you sent only 25% to college savings, your kid would be set for In-state schools. If private elite universities was your goal, then you could choose to save 50%+ of your increase (after tax) and likely be able to swing it. Not that I'd recommend doing that, I'd stick with the In-state plus a bit extra as a college goal if that was my financial situation. But you could choose to save it all for college and live like you had been 18 years ago.

? $100K income would still pay taxes, and generally, in hcol areas, like MD and CA (where I moved from), the state income taxes are high. Now, you could say, then you should've moved to a lcol, but then I'd be making less income, too. Generally, wages are location based.

So, if I pay $20K in taxes, max out retirement (let's say 15K at the time), that would leave me with $65k. If I saved $10K/yr for each kid, that would leave me with $45K to pay rent, buy food, clothing, etc.. in a hcol area. Really? I mean sure, if we thought paying for an expensive private, we could have lived like lower income people, but then lower income people would get 100% financial aid, while we get 0 because we now have $300K saved for college. That doesn't seem right to me.

I don't think it's worth it, so my DC#1 with high stats is going to a great state flagship with a bit of merit aid.

I don't agree with OP's assessment, but I also don't agree that people making $200K could've easily saved enough to pay for two kids at $320K each.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The opposite is true,

according to the new research by Stanford economist Raj Chetty and co-authors.They show that 14.5% of students in America’s elite universities (eight Ivy League colleges, University of Chicago, Stanford, MIT, and Duke) are from families in the top 1% of income distribution, compared with only 3.8% from the bottom quintile. That’s a dramatic overrepresentation of the richest Americans.

But think about it. We are talking about a 320k education. Why would the very poor and the very rich be equally represented? Also there are many moor poor people than very rich people so while very rich people are of course over represented they seem to be very much outnumbered by lower income people on campus.

What are you talking about? Op is only referring to "top" colleges. These places are need blind and have endowments in the billions. Affluent students are way overrepresented. Spend a week at a top college and see how many poor kids you can find. Good luck.

Much easier to have the "resume" to get admitted to an elite university if you grew up privileged. The "poor" might attend schools with only a few AP courses if any, they did not have Kumon starting when they were 3, did not have tutors thru MS/HS or a college counselor or individual SAT test prep at $100+/hr. The list goes on and on. There is a dichotomy between what the privileged have growing up vs others. The non-affluent with the top test scores and gpa may not be able to even apply to an elite university because they are worried about affording it (transportation, books, spending $$, etc) so they apply to the local state U or do CC.
Basically, there are many more affluent people applying than non-affluent/poor.

I don't agree with OP's premise, however, my high stats kid has never had a tutor, test prep, or a college counselor other than what the public school provided.

Now, if you are comparing with a private school kid who has had their hand held by the private school, then I might agree with you.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Often 2/3 of students at top ranked schools are getting need based aid that covers the vast majority of costs, on average.

200k is the typical cut off for need based aid (about the income level of a couple of school teachers at the peak of their careers aka “the wealthy”)

It just seems these schools must be populated primarily with lower income kids and then 1/3 rich kids.

I guess middle class kids end up at state school.

No, the middle class of the country goes from 65-160k. So most of the kids are middle class or lower class. That reflects the population as a whole, although in fact upper income kids should be less (20% vs 33%). It’s amazing how many people here actually secretly want a Russian style plutocracy. No wonder trump won.

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

You are missing the point, I think. The approach to pricing that we have now (kids under 150k get a full ride, otherwise you pay full price, more or less) reinforces plutocracy, as only the very affluent can really afford full price.

I think that is what OP is saying, though I don't necessarily agree with OP.

Those expensive colleges are mostly made up of either lower/middle income kids who get a full ride or at least half, and the very wealthy. The middle there are probably going to be eyeballs deep in debt, ie, donut families.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Often 2/3 of students at top ranked schools are getting need based aid that covers the vast majority of costs, on average.

200k is the typical cut off for need based aid (about the income level of a couple of school teachers at the peak of their careers aka “the wealthy”)

It just seems these schools must be populated primarily with lower income kids and then 1/3 rich kids.

I guess middle class kids end up at state school.

No, the middle class of the country goes from 65-160k. So most of the kids are middle class or lower class. That reflects the population as a whole, although in fact upper income kids should be less (20% vs 33%). It’s amazing how many people here actually secretly want a Russian style plutocracy. No wonder trump won.

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

You are missing the point, I think. The approach to pricing that we have now (kids under 150k get a full ride, otherwise you pay full price, more or less) reinforces plutocracy, as only the very affluent can really afford full price.

You are not middle class!! It’s very offensive to claim a lower SES! You are upper class and your peer group is OVER represented at these elite schools. Also, families with income under 150 do not get a ‘full ride.’ They get sliding scale aid, and believe me it is not enough that’s why they max out on student loans. Pell grants only go to very poor families. If you make 200k you are in the top 20% of earners in the country and, good news, your kid is more likely to get into a top college than Susie from Scranton (pretty unfair actually). And your kid will need less loans than Susie from Scranton because you can afford to help them! You are incredibly blind to your privilege.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Often 2/3 of students at top ranked schools are getting need based aid that covers the vast majority of costs, on average.

200k is the typical cut off for need based aid (about the income level of a couple of school teachers at the peak of their careers aka “the wealthy”)

It just seems these schools must be populated primarily with lower income kids and then 1/3 rich kids.

I guess middle class kids end up at state school.

No, the middle class of the country goes from 65-160k. So most of the kids are middle class or lower class. That reflects the population as a whole, although in fact upper income kids should be less (20% vs 33%). It’s amazing how many people here actually secretly want a Russian style plutocracy. No wonder trump won.

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

You are missing the point, I think. The approach to pricing that we have now (kids under 150k get a full ride, otherwise you pay full price, more or less) reinforces plutocracy, as only the very affluent can really afford full price.

You are not middle class!! It’s very offensive to claim a lower SES! You are upper class and your peer group is OVER represented at these elite schools. Also, families with income under 150 do not get a ‘full ride.’ They get sliding scale aid, and believe me it is not enough that’s why they max out on student loans. Pell grants only go to very poor families. If you make 200k you are in the top 20% of earners in the country and, good news, your kid is more likely to get into a top college than Susie from Scranton (pretty unfair actually). And your kid will need less loans than Susie from Scranton because you can afford to help them! You are incredibly blind to your privilege.

OP here. You are kind of missing the point. It's obviously better to be rich than to be poor. But the majority of students at these top schools are qualifying for and receiving substantial need based aid. So these are middle income to low income kids. It's just a fact. Then you have the cohort of kids who are paying full price. Those are very affluent kids, generally, because only the very affluent can afford the luxury of 320k for a bachelors degree. The kids who are missing from this picture are say 60th percentile to 90th percentile on the income spectrum. Their families cant' really afford it and they don't get any aid, and they can't even get merit aid at most of these schools. So they have to go in state most of the time or find some good merit aid... With these colleges it is really all or nothing... either your family clearly can't afford it, so they give you the money, or your family can totally afford it.

[Anonymous]

Unless there are more recent studies out there, the entire thesis of this post is really incorrect. See the results of two college studies:

A 2017 study from The New York Times found that 38 U.S. universities, including five in the Ivy League, have more students from the top one percent of earners than from the bottom 60 percent, and a 2018 report from The Boston Globe found that, at Harvard, rich students outnumbered low-income students 23 to 1.

These are nominal numbers. The 2018 report on Harvard considered rich students to be in the top 1% of income in the US. That means your family earns $800k+ as of 2020.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Often 2/3 of students at top ranked schools are getting need based aid that covers the vast majority of costs, on average.

200k is the typical cut off for need based aid (about the income level of a couple of school teachers at the peak of their careers aka “the wealthy”)

It just seems these schools must be populated primarily with lower income kids and then 1/3 rich kids.

I guess middle class kids end up at state school.

No, the middle class of the country goes from 65-160k. So most of the kids are middle class or lower class. That reflects the population as a whole, although in fact upper income kids should be less (20% vs 33%). It’s amazing how many people here actually secretly want a Russian style plutocracy. No wonder trump won.

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

You are missing the point, I think. The approach to pricing that we have now (kids under 150k get a full ride, otherwise you pay full price, more or less) reinforces plutocracy, as only the very affluent can really afford full price.

You are not middle class!! It’s very offensive to claim a lower SES! You are upper class and your peer group is OVER represented at these elite schools. Also, families with income under 150 do not get a ‘full ride.’ They get sliding scale aid, and believe me it is not enough that’s why they max out on student loans. Pell grants only go to very poor families. If you make 200k you are in the top 20% of earners in the country and, good news, your kid is more likely to get into a top college than Susie from Scranton (pretty unfair actually). And your kid will need less loans than Susie from Scranton because you can afford to help them! You are incredibly blind to your privilege.

OP here. You are kind of missing the point. It's obviously better to be rich than to be poor. But the majority of students at these top schools are qualifying for and receiving substantial need based aid. So these are middle income to low income kids. It's just a fact. Then you have the cohort of kids who are paying full price. Those are very affluent kids, generally, because only the very affluent can afford the luxury of 320k for a bachelors degree. The kids who are missing from this picture are say 60th percentile to 90th percentile on the income spectrum. Their families cant' really afford it and they don't get any aid, and they can't even get merit aid at most of these schools. So they have to go in state most of the time or find some good merit aid... With these colleges it is really all or nothing... either your family clearly can't afford it, so they give you the money, or your family can totally afford it.

Or you send your kid to a lesser ranked college, where your donut-hole child will get merit aid. These are good options, OP.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Often 2/3 of students at top ranked schools are getting need based aid that covers the vast majority of costs, on average.

200k is the typical cut off for need based aid (about the income level of a couple of school teachers at the peak of their careers aka “the wealthy”)

It just seems these schools must be populated primarily with lower income kids and then 1/3 rich kids.

I guess middle class kids end up at state school.

No, the middle class of the country goes from 65-160k. So most of the kids are middle class or lower class. That reflects the population as a whole, although in fact upper income kids should be less (20% vs 33%). It’s amazing how many people here actually secretly want a Russian style plutocracy. No wonder trump won.

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

You are missing the point, I think. The approach to pricing that we have now (kids under 150k get a full ride, otherwise you pay full price, more or less) reinforces plutocracy, as only the very affluent can really afford full price.

You are not middle class!! It’s very offensive to claim a lower SES! You are upper class and your peer group is OVER represented at these elite schools. Also, families with income under 150 do not get a ‘full ride.’ They get sliding scale aid, and believe me it is not enough that’s why they max out on student loans. Pell grants only go to very poor families. If you make 200k you are in the top 20% of earners in the country and, good news, your kid is more likely to get into a top college than Susie from Scranton (pretty unfair actually). And your kid will need less loans than Susie from Scranton because you can afford to help them! You are incredibly blind to your privilege.

OP here. You are kind of missing the point. It's obviously better to be rich than to be poor. But the majority of students at these top schools are qualifying for and receiving substantial need based aid. So these are middle income to low income kids. It's just a fact. Then you have the cohort of kids who are paying full price. Those are very affluent kids, generally, because only the very affluent can afford the luxury of 320k for a bachelors degree. The kids who are missing from this picture are say 60th percentile to 90th percentile on the income spectrum. Their families cant' really afford it and they don't get any aid, and they can't even get merit aid at most of these schools. So they have to go in state most of the time or find some good merit aid... With these colleges it is really all or nothing... either your family clearly can't afford it, so they give you the money, or your family can totally afford it.

Again, you are just wrong. $200,000 income gets you a $40,000 scholarship at Harvard and your EFC is 40,000. Parents can pay and/or loans can be taken out. Ver few in the 60-90% bracket turn down Harvard (or any T20) for financial reasons.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Top LACs with big endowments have generous aid too though.

I guess low income is the new privileged. If your family makes 80k a year, full ride. If they make 200k, you’re screwed.

Lol. I make $80k as a teacher and the least amount of money I’d have to pay for my kid to go to college is $22k. Nice discount but not a full ride or even close to it.

https://www.npr.org/2022/09/09/1121953668/princeton-university-free-tuition-financial-aid

Very few schools would offer a free ride and they have 5% acceptance rates. Not realistic fir the vast majority of students.

Hence the reference to "top" private colleges.

There are plenty of top colleges that don’t have the money to give all low income kids free rides.

Basically all the top 20+ universities and even LACs have very large endowments and meet full need. 40-65% are receiving financial aid with average awards $50-55k. Even the handful of need aware schools on this list meet full need. Endowments are huge, there are only so many libraries you can build, and this is how they are spending their money--increasing the percentage of low income students at the school (while at the same time jacking up the full retail price every year for families who don't make less than $100k).

Okay but I consider top colleges as more than 20 schools.

[Anonymous]

At many elite schools, the kids receiving aid are from middle-income families on paper (very few students are truly lower income), but their parents have very strong educational backgrounds and educational capital. For example, Harvard has a huge number of students that are the children of professors and other academic/nonprofit types.

[Anonymous]

Anonymous wrote:Unless there are more recent studies out there, the entire thesis of this post is really incorrect. See the results of two college studies:

A 2017 study from The New York Times found that 38 U.S. universities, including five in the Ivy League, have more students from the top one percent of earners than from the bottom 60 percent, and a 2018 report from The Boston Globe found that, at Harvard, rich students outnumbered low-income students 23 to 1.

These are nominal numbers. The 2018 report on Harvard considered rich students to be in the top 1% of income in the US. That means your family earns $800k+ as of 2020.

No one said rich kids weren't at top schools. The point was that these schools now mainly consist of kids whose parents qualify for aid, usually a lot of aid. 30 years ago, the schools were mainly middle class and upper middle class, with healthy dose of upper class. Now they are mainly middle to lower middle class paired with upper upper middle class to upper class.

Yes, there are tons of rich kids at these schools, a disproportionate number. But the majority of students are paying a fraction of the cost of attendance, if anything. This is different.