How Princeton is Getting Around the Endowment Tax

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Seems like a win for everyone!

Seems like it makes the endowment tax arbitrary stupid nonsense. Don't tax Princeton but tax MIT. Don't text Amherst or NYU but tax Notre Dame. This whole thing just seems pointless.

It is a Pigovian tax. It wasn’t intended to raise revenue. This is an optimal outcome, perhaps even an intended one.

It’s kind of crappy to be a family who makes just a tad over the line (or who have more than typical assets) who will pay full price while others just a tiny bit under the line pay none. I get the rationale but it’s not optimal from that perspective.

Totally agree - this system is very binary - all or nothing. There will be a lot of gamesmanship among families to get below the line - ironically people will have an incentive to take a pay cut for a few years. It makes very little sense yet given the constraints Princeton is dealing with, I don't blame them. But as one who is not far over the line and also had the audacity to live somewhat conservatively and save money for college, it is frustrating. But life isn't fair - I'm fortunate to have more than most other Americans and college is not a God-given right.

This is wrong. It is not binary but a sliding scale but Princeton is in a position to be generous.

But are you seriously saying " life is not fair" because you are unhappy with your financial aid award at Princeton? Are you the same poster that was so "squeezed" a college even though they had a car on campus and could only "occasionally" go out to a show? Some of you all are seriously in a bubble.

What have you seen suggesting it’s a sliding scale? It seems like kids with aid got a lot more aid (so they aren’t counted as tuition payers) and kids with no aid continued to get no aid.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Seems like a win for everyone!

Seems like it makes the endowment tax arbitrary stupid nonsense. Don't tax Princeton but tax MIT. Don't text Amherst or NYU but tax Notre Dame. This whole thing just seems pointless.

It is a Pigovian tax. It wasn’t intended to raise revenue. This is an optimal outcome, perhaps even an intended one.

It’s kind of crappy to be a family who makes just a tad over the line (or who have more than typical assets) who will pay full price while others just a tiny bit under the line pay none. I get the rationale but it’s not optimal from that perspective.

Totally agree - this system is very binary - all or nothing. There will be a lot of gamesmanship among families to get below the line - ironically people will have an incentive to take a pay cut for a few years. It makes very little sense yet given the constraints Princeton is dealing with, I don't blame them. But as one who is not far over the line and also had the audacity to live somewhat conservatively and save money for college, it is frustrating. But life isn't fair - I'm fortunate to have more than most other Americans and college is not a God-given right.

This is wrong. It is not binary but a sliding scale but Princeton is in a position to be generous.

But are you seriously saying " life is not fair" because you are unhappy with your financial aid award at Princeton? Are you the same poster that was so "squeezed" a college even though they had a car on campus and could only "occasionally" go out to a show? Some of you all are seriously in a bubble.

What have you seen suggesting it’s a sliding scale? It seems like kids with aid got a lot more aid (so they aren’t counted as tuition payers) and kids with no aid continued to get no aid.

Why are you whining about? Go to the net price calculator and you can your estimated costs depending on your inputs. If you are unhappy with your award from Princeton, don't go to Princeton.

[Anonymous]

Anonymous wrote:Princeton makes financial aid changes presumably to get it to fewer than 3,000 “tuition-paying” students.

https://www.princeton.edu/news/2025/08/07/princeton-enhances-financial-aid-again-it-welcomes-class-2029-which-includes

Genius! Good for Princeton. I love it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Seems like a win for everyone!

Seems like it makes the endowment tax arbitrary stupid nonsense. Don't tax Princeton but tax MIT. Don't text Amherst or NYU but tax Notre Dame. This whole thing just seems pointless.

It is a Pigovian tax. It wasn’t intended to raise revenue. This is an optimal outcome, perhaps even an intended one.

It’s kind of crappy to be a family who makes just a tad over the line (or who have more than typical assets) who will pay full price while others just a tiny bit under the line pay none. I get the rationale but it’s not optimal from that perspective.

Totally agree - this system is very binary - all or nothing. There will be a lot of gamesmanship among families to get below the line - ironically people will have an incentive to take a pay cut for a few years. It makes very little sense yet given the constraints Princeton is dealing with, I don't blame them. But as one who is not far over the line and also had the audacity to live somewhat conservatively and save money for college, it is frustrating. But life isn't fair - I'm fortunate to have more than most other Americans and college is not a God-given right.

This is wrong. It is not binary but a sliding scale but Princeton is in a position to be generous.

But are you seriously saying " life is not fair" because you are unhappy with your financial aid award at Princeton? Are you the same poster that was so "squeezed" a college even though they had a car on campus and could only "occasionally" go out to a show? Some of you all are seriously in a bubble.

Wow. Don't we have a bit of angst.

First of all, if you read the article, you would see it is no longer a sliding scale. It is basically full ride or nothing. Reading is Fundamental.

Second, what part of my last sentence did you not read. I said I am fortunate to have what I have and that my kid is not guaranteed to go anywhere. But the system stinks. But if that is the biggest problem America faces, we would be doing really well. Instead, as demonstrated by you, we have a clearly very deficient educational and mental health management system.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I've never attended one of these private schools with the massive need-based aid programs. Is it a weird dichotomy with basically only poor kids and rich kids and no real middle class?

I attended a state school so there were basically all types of kids, but lots of middle class.

There is a lot of aid that goes to middle class families at a place like Princeton. At Princeton middle class is poor.

Not true. Our income is middle class but our assets are not. We had the audacity to save and live a lifestyle well within our limits. We ran Princeton’s NPC (as well as for other private schools) and it resulted in zero aid.

I’m pp..,And let me add, my kid was very high stats including 1550 (no prep); NMF; valedictorian; 4.0/4.8 (5.2 upon graduating); high rigor); solid long term EC including niche sport and instrument both at state level.

Princeton does not award merit aid to anyone. So what do stats have to do with it? Princeton will only award need based aid.

But with those stats a student can get merit aid at many institutions....but not princeton or any need blind ivy. You were not singled out. That is the case for every student.

Good Lord. I am well aware Princeton does not award merit aid. None of the Ivy schools do.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Seems like a win for everyone!

Seems like it makes the endowment tax arbitrary stupid nonsense. Don't tax Princeton but tax MIT. Don't text Amherst or NYU but tax Notre Dame. This whole thing just seems pointless.

It is a Pigovian tax. It wasn’t intended to raise revenue. This is an optimal outcome, perhaps even an intended one.

It’s kind of crappy to be a family who makes just a tad over the line (or who have more than typical assets) who will pay full price while others just a tiny bit under the line pay none. I get the rationale but it’s not optimal from that perspective.

Totally agree - this system is very binary - all or nothing. There will be a lot of gamesmanship among families to get below the line - ironically people will have an incentive to take a pay cut for a few years. It makes very little sense yet given the constraints Princeton is dealing with, I don't blame them. But as one who is not far over the line and also had the audacity to live somewhat conservatively and save money for college, it is frustrating. But life isn't fair - I'm fortunate to have more than most other Americans and college is not a God-given right.

This is wrong. It is not binary but a sliding scale but Princeton is in a position to be generous.

But are you seriously saying " life is not fair" because you are unhappy with your financial aid award at Princeton? Are you the same poster that was so "squeezed" a college even though they had a car on campus and could only "occasionally" go out to a show? Some of you all are seriously in a bubble.

Wow. Don't we have a bit of angst.

First of all, if you read the article, you would see it is no longer a sliding scale. It is basically full ride or nothing. Reading is Fundamental.

Second, what part of my last sentence did you not read. I said I am fortunate to have what I have and that my kid is not guaranteed to go anywhere. But the system stinks. But if that is the biggest problem America faces, we would be doing really well. Instead, as demonstrated by you, we have a clearly very deficient educational and mental health management system.

That is not what it says. Read it again. Your kid is going to get a Princeton University education and the system stinks. Okay sure.

[Anonymous]

I really don't think it's no longer a sliding scale. It's just that the threshold for those who get full tuition will be higher (now $250,000 income). Those above that threshold may still get aid.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Seems like a win for everyone!

Seems like it makes the endowment tax arbitrary stupid nonsense. Don't tax Princeton but tax MIT. Don't text Amherst or NYU but tax Notre Dame. This whole thing just seems pointless.

It is a Pigovian tax. It wasn’t intended to raise revenue. This is an optimal outcome, perhaps even an intended one.

It’s kind of crappy to be a family who makes just a tad over the line (or who have more than typical assets) who will pay full price while others just a tiny bit under the line pay none. I get the rationale but it’s not optimal from that perspective.

Totally agree - this system is very binary - all or nothing. There will be a lot of gamesmanship among families to get below the line - ironically people will have an incentive to take a pay cut for a few years. It makes very little sense yet given the constraints Princeton is dealing with, I don't blame them. But as one who is not far over the line and also had the audacity to live somewhat conservatively and save money for college, it is frustrating. But life isn't fair - I'm fortunate to have more than most other Americans and college is not a God-given right.

Plus don't pretend that your approach to money and saving isn't helping you out in other ways. You might not be getting a college break, but there are so many other benefits you get by living this way.

NP. Like what? We have a single car, don’t do vacations at all beyond drive to the beach and stay in a motel type of thing or camping, shop at Walmart for clothes, literally never eat out, we do spend more money than most people on food because our kids have severe food allergies and we need to. We have other therapies for special needs but basically just a typical middle class lifestyle plus some extra frugality compared to most people, and yet we just miss out on all financial aid. No family money at all (we were first gen), actually we support our parents a little if anything. Our kids are very high stats and so could definitely get some merit at some places but it’s frustrating that ivys are out for them because we really can’t afford it. If we lived irresponsibly and didn’t work so hard, they would get financial aid. The system sucks.

[Anonymous]

I would bet there are 5x more kids from families earning $150k-$350k ($350k is the max where you receive no FA) vs families under $150k.

Thats why Princeton ranks in the top 15 of all schools by median income which isn’t skewed by billionaires for the average.

BTW, this press release looked largely identical last year, but they upped the no tuition limit to $250k from $200k. This isn’t a new policy to avoid the endowment tax as I believe in fact last year like 69% received significant aid and now they say 65%.

[Anonymous]

Anonymous wrote:I would bet there are 5x more kids from families earning $150k-$350k ($350k is the max where you receive no FA) vs families under $150k.

Thats why Princeton ranks in the top 15 of all schools by median income which isn’t skewed by billionaires for the average.

BTW, this press release looked largely identical last year, but they upped the no tuition limit to $250k from $200k. This isn’t a new policy to avoid the endowment tax as I believe in fact last year like 69% received significant aid and now they say 65%.

Agree to disagree. They just increased the undergraduate financial aid budget by $21 million over what was approved by the Trustees in April. This is absolutely intended to avoid the endowment tax.

[Anonymous]

Anonymous wrote:I really don't think it's no longer a sliding scale. It's just that the threshold for those who get full tuition will be higher (now $250,000 income). Those above that threshold may still get aid.

Correct, between $250k-$350k you receive FA but it’s a sliding scale.

It’s $200k or below…100% free.

$200k-$250k free tuition plus sliding scale for room/board et al.

$250k-$350k you pay 100% room and board and a sliding scale for tuition.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I would bet there are 5x more kids from families earning $150k-$350k ($350k is the max where you receive no FA) vs families under $150k.

Thats why Princeton ranks in the top 15 of all schools by median income which isn’t skewed by billionaires for the average.

BTW, this press release looked largely identical last year, but they upped the no tuition limit to $250k from $200k. This isn’t a new policy to avoid the endowment tax as I believe in fact last year like 69% received significant aid and now they say 65%.

Agree to disagree. They just increased the undergraduate financial aid budget by $21 million over what was approved by the Trustees in April. This is absolutely intended to avoid the endowment tax.

I don’t know how you qualify for the 3000 mark…but if 69% received significant aid last year and 65% rec I’ve it this year, what’s the change exactly?

Is the number paying $0?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Seems like a win for everyone!

Seems like it makes the endowment tax arbitrary stupid nonsense. Don't tax Princeton but tax MIT. Don't text Amherst or NYU but tax Notre Dame. This whole thing just seems pointless.

It is a Pigovian tax. It wasn’t intended to raise revenue. This is an optimal outcome, perhaps even an intended one.

It’s kind of crappy to be a family who makes just a tad over the line (or who have more than typical assets) who will pay full price while others just a tiny bit under the line pay none. I get the rationale but it’s not optimal from that perspective.

Totally agree - this system is very binary - all or nothing. There will be a lot of gamesmanship among families to get below the line - ironically people will have an incentive to take a pay cut for a few years. It makes very little sense yet given the constraints Princeton is dealing with, I don't blame them. But as one who is not far over the line and also had the audacity to live somewhat conservatively and save money for college, it is frustrating. But life isn't fair - I'm fortunate to have more than most other Americans and college is not a God-given right.

Plus don't pretend that your approach to money and saving isn't helping you out in other ways. You might not be getting a college break, but there are so many other benefits you get by living this way.

NP. Like what? We have a single car, don’t do vacations at all beyond drive to the beach and stay in a motel type of thing or camping, shop at Walmart for clothes, literally never eat out, we do spend more money than most people on food because our kids have severe food allergies and we need to. We have other therapies for special needs but basically just a typical middle class lifestyle plus some extra frugality compared to most people, and yet we just miss out on all financial aid. No family money at all (we were first gen), actually we support our parents a little if anything. Our kids are very high stats and so could definitely get some merit at some places but it’s frustrating that ivys are out for them because we really can’t afford it. If we lived irresponsibly and didn’t work so hard, they would get financial aid. The system sucks.

So apparently you have figured out how to have some of the things you want plus get financial aid but you refuse to do it? Maybe the system doesn't suck. Maybe you just aren't understanding how to benefit from the system?

And if you don't want to shop at Walmart like most people so that your kid can get a Princeton education, then dont. No one is forcing you to do that. The system sucks because you you have to shop at lower price stores like most people instead of expensive stores?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would bet there are 5x more kids from families earning $150k-$350k ($350k is the max where you receive no FA) vs families under $150k.

Thats why Princeton ranks in the top 15 of all schools by median income which isn’t skewed by billionaires for the average.

BTW, this press release looked largely identical last year, but they upped the no tuition limit to $250k from $200k. This isn’t a new policy to avoid the endowment tax as I believe in fact last year like 69% received significant aid and now they say 65%.

Agree to disagree. They just increased the undergraduate financial aid budget by $21 million over what was approved by the Trustees in April. This is absolutely intended to avoid the endowment tax.

I don’t know how you qualify for the 3000 mark…but if 69% received significant aid last year and 65% rec I’ve it this year, what’s the change exactly?

Is the number paying $0?

I don't know where you're getting the 69% and 65% numbers. Earlier in the year they increased the undergraduate financial aid budget from $283 million (for 24-25) to $306 million for 25-26, and now they've increased it another $21 million for 25-26. This added $21 million will go toward getting more students into the non-tuition-paying category.

[Anonymous]

Just here to reiterate that "getting more students into the non-tuition-paying category" means students admitted and choosing to enroll, in a need-blind admissions environment.

They should drop the pretense of need-blind since need will, in fact, play a role in this process one way or another. Right now it's on the back end, but one bad algorithm from enrollment management consulting can really mess with the budget.