FA shouldn't go to people with 1 million dollar houses

[Anonymous]

People in the city like to joke around, Burbie. Must be the access to those comedy clubs. Don't take it the wrong way.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I think there is a fundamental misunderstanding about financial aid here. It is not charity. It is a discount to help maximize revenues.

I don't think I understand you here. Are you saying it's a revenue-maximizing behavior for schools to offer financial aid? Maybe I could agree if you're defining "revenue" broadly to include characteristics the school might want to obtain besides dollars (e.g., an economically diverse student body). But if you're defining "revenue" in the traditional way (i.e., cash money), I don't think I agree with you. It seems many well-regarded schools in the DC area would have little trouble filling every empty seat with students paying full-freight even if they were to eliminate financial aid entirely. Offering financial aid might provide schools with certain goodwill benefits that carry some intangible value (in much the same way I derive some goodwill benefit by dropping a dollar in the Salvation Army bucket), but I don't see how offering financial aid is truly maximizing revenues.

Yes, but would they be able to fill the class with excellent students paying full freight? Already/necessarily they are taking some students on the basis that their families are or might become major donors rather than on the basis of what the kids themselves have to offer. Go too far in that direction (buy your way in) and you dilute the brand. Go too far in the other direction (to hell with money, we're just taking the kids we think are the best & brightest) and you go bankrupt (and/or can't afford the fancy facilities you need to stay competitive). The middle ground would be 80%+ fee paying high-scoring/-performing kids.

[Anonymous]

I don't see how the revenue-maximizing rationale for FA can be reconciled with the claim made by at least some elite schools that one's application will be considered without regard to one's need for FA. If that were true, these schools might well end up in the second, "bankrupt" category described by PP. So what is being said here is that OF COURSE financial need is being taken into account, and that schools are looking for a mix of the super rich, the best and brightest (who may or may not need aid) and the middle ground (who are pretty bright and can pay most of their own way). Add to that racially diverse applicants (who may or may not need aid). And what this all means is that the claim that financial need is irrelevant to the admissions decision is itself a lie, in many cases. What am I missing here??

[Anonymous]

Maximize revenues in the sense that they can't attract the rich kids (of all races) if they don't have at least a little socio-economic diversity? Very few people want their kids to go to school in a true greenhouse, just a moderately warm greenhouse....

[Anonymous]

Anonymous wrote:What makes you think that what is driving me is not an actual desire to see a fair utilization of the scarce resource of financial aid? What makes you think that my 'judgment' is not based on solid information?!

If you are comfortable that your need is real, then don't worry. I would think you would be happy to see that the process by which aid is allocated is examined and discussed, so that real need is addressed. I certainly never questioned any inquiry into my family's financial situation when I was on financial aid.

Your judgement is not based on solid information because you don't know exactly who gets financial aid, how much they get, and why.

I am positive that the process by which aid is allocated is fully vetted by both the external company all the schools use to pore over W2s and other financial information/forms and the schools that ultimately decide on the aid. These schools care about every dime they are giving families. I'm sure they spend an incredible amount of time and resources making these decisions. They know what kind of car, house, vacations etc all the FA recipients have/take. Many of these FA officers have been doing this for 10, 20 years. What makes you think you have some inside knowledge or "judgement." The people who have all the information are examining and and discussing FA. I don't think it needs to be done on this forum.

[Anonymous]

Anonymous wrote:Again: The system is wacked. People who get FA and spend $10,000 a year on international travel? People who rent huge homes for $5,000 a month when they could downsize and save on rent? What's the fancy rental for except appearances. Oh, and people on FA who drive $50,000 cars instead of $25,000? Something is wrong with this picture. I make sacrifices, pay full freight only to subsidize this? I'm fine subsidizing students who really need FA. Folks who don't are gaming the system.

I don't know about your school, but the schools I'm familiar with ask FA recipients how much they spend on vacations, cars, homes etc. I really think it is very rare for people to game the system. I guess some people cheat on their taxes, cheat on expense reports etc etc but we all know they will pay later and there isn't much we can do.

[Anonymous]

Anonymous wrote:Is the Financial Aid given to parents public information? Aren't there privacy rules? I don't think that information should be disclosed because it causes a lot of the judgement calls that have been going on in this forum. In addition, the negative feelings non financial aid parents have can be passed on to their kids who can go ahead and make the recipient kids feel poorly in school for something that has nothing to do with the child.

Anyone agree?

It is all strictly confidential. No one knows who receives FA.

[Anonymous]

Anonymous wrote:I am a single mother that makes 55,000 per year! My son's father barely supports him! I have a home and my DS will be starting first grade at a private school this fall thanks to FA. After reading this forum I am very worried about the mindset of parents towards families that receive FA! Are your kids going to bring dinner conversations into school? If my child does not look "poor" enough is there going to be a mob of angry parents demanding my tax info! I am a wonderful saver and shopper! I do not shop often but when I do I love to shop at second hand stores! My DS always looks great because his mother is a savvy shopper! Are parents going to look him in possibly a name brand outfit and make assumptions? Even though I may have paid LESS than Target prices! If we go to the beach for the weekend and he comes to school and mentions it, are parents going to lose their minds? I surely hope this is not the case! Becase you will never hear me bragging about FA. I am grateful, but hurt that I can not afford to send my child to this wonderful school with out assistance! However, if I were to even catch a wisper of some parent making a remark to me or my child that I feel is inappropiate I would/will confront that person! KNOW for sure what you are talking about before you assume a situation! Your gossip can hurt a child! I surely hope this will never be the case but after reading this forum I am prepared to deal with any parent that thinks they have the right to make judgements about my FA situation! So I urge you all to think about the damage you could do if you let your thoughts turn into words!

Thanks for your post. I have been receiving FA for many years and I have never heard one word about it at school or from any parent or child. I don't know what's up with this forum, but please don't worry about it being an issue.

[Anonymous]

Anonymous wrote:I'd like to hear from the million dollar house dweller receiving financial aid who says I and others have NO CLUE. Well, please, clue me in. If you're telling me you have a million dollar mortgage, I say, okay, you're an idiot. You can't afford that, clearly. Sell your house (without any equity) and rent something you can afford. If you say there is a tax advantage, that's true. But that doesn't mean you live in a house you can't afford for a tax break. You live in a house you CAN afford for a tax break, or you rent. You don't penalize other children of need because you spent more on housing than you should have.

If on the other hand you actually have some substantial equity left in your house, tell me why it's fair that you accumulate wealth while borrowing from others.
**

That would be me. So I can use zillow too and see our house is estimated at $1 million. That is a zillow estimate. The real value is more like 850 best based on comparables on the street. The tax assessed value has gone from 600 all the way to $1.1 million and has now headed back down to 900 or so. The mortgage total is at just over 750. After taxes and commissions etc there is nothing left if we sold. Why would we sell in this market anyway? Call me an idiot, fine I can take it. Bt it isn;t very nice to namecall or accuse when you know one fact (an expensive house) without knowing any other inputs into the FA decisions, other aspects of our financial situation.

Regarding the house in question, the monthly mortgage is not unreasonable, how much do you think a 3 bedroom apartment or rental costs in a safe neighborhood where we can walk to work and school? With the tax advantage, it makes owning better than renting. We are certainly not accumulating wealth, but if we do then we would expect to get less or no FA. If we had savings, more equity, higher incomes,less expenses, etc, then our financial situation would be different and viewed differently by our school.

We are not penalizing other children of need. That is a pretty outrageous accusation. If the school deemed us not needy of FA we would not get any. We wouldn't. It is not merit based. It is measured by financial models which take all the inputs and spit out what the parent contribution should be. The schools consider this number when awarding aid. In a city like DC a school may award a bit more more aid given the cost of living. How are we penalizing other children? Because we are taking money away from the FA pot? The school wants a balance of full pays, full scholarships and partial pays. We are grateful for the FA we get, and will at some point give back what we can, as we can.

Excellent post - we are in a similar situation with different variables/factors. There are many, many different scenarios and the schools have all the facts and make informed decisions based on tax records and other financial records.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I guess I am saying that people are arguing from very different perspectives and based on vastly different assumptions of what things are necessities in life.

You are so right! I've lived at all sorts of income levels -- from below the poverty line (but not welfare dependent or hungry) to affluent (but not wealthy enough that the next generation can live at the same level without having good jobs of their own) -- and it's interesting to see what people think they are entitled to and how they talk about "choice" without recognizing how radically different the available options are at different income levels. And, so often, their comparisons are to people at similar income levels and all they see is what someone else has that they lack. So my law partners or neighbors all send their kids to private school -- I deserve that too, even though I can't afford it because I have medical expenses or bought my house at the peak of the market. They don't compare themselves to people who have less -- e.g. this kid will be going to a terrible public school if she can't get into private and my kid would be going to a decent public school. And the adults in her family are already living frugally and working multiple jobs.

In the end, though, I wonder about the economics. How much FA goes toward discounting tuition enough to find more buyers for private school? If $30,000 of FA goes to five high income families who, together, pay the equivalent of four full tuitions is the $30,000 better spent from the school's financial perspective than if the school were to give the whole $30,000 to one kid? In each case the school has spent the same amount, but in one case it generated significant income and in another it generated no income.

You make a very valid point about giving a little FA to more people rather than a lot to fewer. Also, it can be difficult for a very, very poor child to feel comfortable and fit in at certain schools. Sometimes it's just logistically tough for someone in say, Anacostia, to get to and from NW DC everyday. Friends and family sometimes question this decision. It can be a culture shock and I think the schools know this. Sometimes the academics are really challenging when moving from a poorly performing school to a high pressure, high performing school. Also, schools don't want all rich and all poor - they want a variety of incomes.

[Anonymous]

Anonymous wrote:10:28 I am not advocating throwing out the baby with the bath water. I'm advocating retooling the system so private schools don't subsidize a luxury lifestyle through FA. I make sacrifices. I pay full freight. It ticks me off. We all pay for this nonsense through tuition. Also, what is this strain of reasoning: The world is imperfect, let's not try to fix anything. Also, most social welfare programs are large and anonymous. These folks are doing this for the entire community to observe! It's almost a disorder.

It's unfortunate you feel your school subsidizes luxury lifestyles. I trust the administrators at my school and think they do a good job. I also think the fast majority of people don't cheat or game the system. Most people I know wouldn't dream of mentioning they get FA.

[Anonymous]

Anonymous wrote:12:00 I think the idea is there would be more FA for those who needed it if folks didn't take advantage of the system. Why are people squelching this discussion? The intentions of folks like me who think schools should examine their FA policies is to bring about corrective measures.

The reason people are disagreeing with you or "squelching this discussion" is because we don't think corrective measures are needed. You don't know what anyones true financial situation truly is unless you review their financial details (like the schools do). Why do you assume that the schools are wrong? $30.000+ is a lot of money and you can make a pretty good income and still not be able to fully afford a school, especially with multiple children.

[Anonymous]

Anonymous wrote:12:32 I knew what I was signing up for, absolutely, but I didn't know that people abused the FA process and I didn't know that so many people, including apparently you, seem just fine with that. For the record, my child would probably get $6,000 - $8,000 in aid if we applied. You're telling me that's peanuts? I know tuition doesn't cover the full cost (duh). That's besides the point. This is $6,000 - $8,000 less the school has to raise each year. That's basic math. If a few more families did that, we'd be able to give a full scholarship. And you think that's not problematic? I mean, people with second homes on FA? Yes! And children's trust funds don't get counted. Amazing! The system is WACKED.

I clicked around for information on FA and Bullis' (my child does not attend, we know several children who do) covers many of the very things we've discussed here. So obviously the FA folks are thinking this through.

Who qualifies for financial aid at Bullis?
All financial aid at Bullis is need based. Aid amounts are based exclusively on demonstrated financial need. We try to accommodate as many families as possible within the financial aid budget the Board approves each year.
Bullis expects that a family will have researched all of its own resources before coming to the school for financial aid. Since the school wants to give financial aid to the families that need it the most, we have to be able to assess the financial strength of each family applying for aid. To do this, many factors need to be considered. Some of these include: (1) income, both taxable and nontaxable; (2) assets (home equity, other real estate, savings, stocks, etc.); (3) number of dependents; (4) age of parent(s); and (5) number of children attending tuition-charging schools. We also consider a number of variables when making tuition aid awards: consumer debt, earning potential for spouse not employed outside the home, automobiles (fair market and/or lease value), recreational vehicles, second homes, vacation expenses and student travel/enrichment activities.

All the schools have the same requirements that you listed above (from Bullis). This is nothing new. This has been the case for many years.

[Anonymous]

Were all the posts after 11:30 pm by the same poster?

Listen, at my son's school, no one talks about who is on financial aid, but it is also clear that there are families where it would be impossible for them to pay one or two full tuitions. So in a sense, you do know. And it never enters into the minds of parents or kids in any way.

Having said that, I don't think there is ANYTHING wrong with having a discussion about whether FA has been abused by families with wealth. Obviously, the intention here is to see that the system is improved. I certainly don't think anyone would question why a single mom earning 55K would get financial aid. But I would question why a person earning about $200K in a huge house is getting it.

[Anonymous]

Anonymous wrote:Were all the posts after 11:30 pm by the same poster?

Listen, at my son's school, no one talks about who is on financial aid, but it is also clear that there are families where it would be impossible for them to pay one or two full tuitions. So in a sense, you do know. And it never enters into the minds of parents or kids in any way.

Having said that, I don't think there is ANYTHING wrong with having a discussion about whether FA has been abused by families with wealth. Obviously, the intention here is to see that the system is improved. I certainly don't think anyone would question why a single mom earning 55K would get financial aid. But I would question why a person earning about $200K in a huge house is getting it.

Sigh. You really don't get it: that $200K income and "huge house" are not sufficient basis for SSS or schools to make FA decisions, and therefore you should not judge on that basis either.