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SLC 2019 @ Pepperdine
Money Matters - Understanding and Navigating Need-based and Merit-based awards at Private Institutions
Charlie Leizear, Occidental CollegeShelley Kierman, Milken Community SchoolsRoss D. Mankuta, Milken Community Schools
Objectives
Curioustolearnhowmeritandscholarshipaidisbeingusedasarecruitmenttoolforadmissionsoffice? Thissession,intendedforbeginners,willexploreallthingsfiduciaryintheadmissionsprocess.Comerefreshyourunderstandingoftheterminology- needawarevs.needblind,meetingdemonstratedneedvs.gapping,nettuitionrevenue,discountrates,andthebiggestconundrumcurrentlyfacingtheprofession-theabilitytopayvs.thewillingnesstopayforfamilies.
Welcome!
• ScholarshipLingo
• InstitutionalAwards
• TipsandTricks
• Questions
TalkingtheTalk• NeedAware
• NeedBlind
• Meetingfulldemonstratedneed
• Gapping
• Nettuitionrevenue
• Discountrate
• AbilitytoPayvs.WillingnesstoPay
NeedBlindvs.NeedAware
NeedBlind• TheGood:Nofinancialinformationisusedtodeterminea
student’seligibility
• TheBad:Manyoftheseinstitutionscan’tmeetfullneed
• TheFinePrint:NeedBlindprocessesseldomapplytostudentsadmittedfromthewaitlistortransferstudents
• International:Only5schoolsofferneed-blindprogramsthatareinclusiveofinternationalstudents-Amherst,Harvard,MIT,Princeton,&Yale
NeedAware• TheGood:Studentstypicallyreceiveverycompetitiveaid
packagesthatmeettheentiretyoftheirneed
• TheBad:Preferentialtreatmentmaybegiventostudentswhodon’trequirefunding;admissionforstudentsrequiringsignificantaidmaybeespeciallycompetitive
• International:Need-basedaidforinternationalstudentsisextremely,extremelycompetitive
MeetingFullNeed
• TheGood:Institutionscommittofundingstudentstooff-setwhateverisn’tcoveredbythefamily’sEstimatedFamilyContribution(EFC)
• TheBad:Sometimesfamiliesdon’tagreewiththeirassessedEFC.
• TheFinePrint:Stateinstitutions-alatheUniversityofMichigan-mayonlydothisforin-statestudents
TheLandscape
0 20 40 60 80 100 120
NeedBlind
NeedBlind,MeetFullNeed
NeedAware,MeetFullNeed
NumberofPrivateInstitutions
NumberofInstitutions
Gapping• TheGood:Notapplicable,exceptperhaps studentscan
resttheirlaurelsonknowingtheywere‘admitted’eventhoughtheycan’taffordtomatriculate.
• TheBad:Studentsareadmittedbutaren’tgivenfinancialaidawardstohelpoff-setcostofattendance.Formany,itbecomesafinancialimpossibilitytoenroll.Forothers,theyenrollanyway,takingonexcessiveloans.
FAFSAvs.CSSProfileForm• CSSProfileForm typicallyrequiresmoreinformationthan
theFAFSAfromthefamilyandweightsincomeandassetsdifferently.
Forexample:
• Non-custodialparentfinancialinformation• Smallbusinessvalue• Homeequity• Giftsaretreatedasincomeratherthanas
assets
About200schoolswillrequireboth.
Prior-PriorYear• TheGood:Taxdataisalreadycompletewhenit’stimeto
applyforaid,andoftencanbeinstantlydownloadedusingtheIRSDataRetrievalTool.
• TheBad:Aiddeadlinesarenowoftenmuchearlier;notimeforprocrastination!
• TheFinePrint:Familieswhosefinancialstatushaschangedsignificantlyareimpactedandoftenneedtosubmitanappeal.
DatacareofForbes.com,2017
DatacareofForbes.com,2017
SoMuchFinePrint• EFCsdonottakeintoconsiderationanyparentorstudentassetsthatmaybereportableon
thefinancialaidforms,andcountedintheaidformulas.
• Assetscountedarenon-retirementassets,andtheaidformulasweighassetsinstudents’namesmoreheavily(20-25%)thantheydoparents'assets(5-5.64%)
• Smallbusinessassetsdonotcountunder theFederalMethodology, buttheydounder theInstitutionalMethodology.
• HomeequitycountsundertheInstitutionalMethodology, andnotatallunder theFederalMethodology, depending upon thestate.
• Therefore,whenyourassetsareaddedintotheoverallaidcalculationyouractualEFCmaybehigher.
• Furthermore, theaveragecostofcollegeinyourhomestatemayvaryfromthenationalaveragecoststhatthistableusestoestimateaideligibility, andtheEFCsshownarebasedsolelyontheFederalMethodology ofcalculatingEFC.
$-
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
$90,000
$100,000
$9,088 $31,698 $50,627 $78,457 $111,919 $134,077 $172,791 $177,571 $238,976 $325,366abilitytopayperyear willingness topayperyear
DatacareofMoody’sInvestments,2016
Ability&WillingnesstoPayforPrivateCollege,byAGI,2016
(4727casesreviewed)
NetTuitionRevenue&DiscountRate
• NetTuitionRevenue(NTR):Theamountofrevenueaninstitutiontakesinfromtuitionandfees,netofallinstitutionalgrantaidprovidedtostudents.
• DiscountRate:Theratiooftotalinstitutionalgrantaidrelativetogrosstuitionrevenuesataninstitution
Privateinstitutionspipednearlyhalfofeverydollarchargedintuitionandfeesbackintoscholarshipsandgrantsforfreshmen.
DiscountRateTrends
Institution-SpecificScholarships
• Whyuniversitiesgivescholarships,orwhytheydon’t
• Whatdoesitmeantobemeritorious?• Meritisintheeyeofthebeholder.J
• Application-basedprograms• HonorsPrograms,Fellowships,etc.
• Meritaidvs.financialaid
Institution-SpecificScholarships• Guaranteed
scholarshipswithpublicizedcriteria
• Generalscholarshippools
“automaticallyconsideredbyapplyingtotheschool”
AnyOldUniversity
$50,000 Tuition$15,000 Housing&Fees$5,000 Travel,Books,Etc.
$70,000 CostofAttendance
AwardsMayVary
MeetingFullNeed$70KCOA
$30KEFC$40Kininstitutionalaid/grants,federalloans,andself-help
Gapping$70KCOA
$30KEFC$20Kininstitutionalaid/grants,federalloans$20Kgap
MeritRarelyImpactsThoseWithNeed
Non-Meritorious$70KCOA
$30KEFC$40Kininstitutionalaid/grants,federalloans,andself-help
Meritorious$70KCOA
$30KEFC$20Kina‘Scholarship’$20Kininstitutionalaid/grants,federalloans,andself-help
Bottomline:Familypays$30Keitherwayunlessscholarshipisinexcessofthefamily’sNeedlevel
Familieswithlittle/no‘need’whostillareshoppingformeritaidshouldbecautiousofthefollowing:
• EarlyDecisionprograms• TestOptionalprograms• Admissibledoesnotequatetomeritorious• Negotiating/Barteringforawards
MeritAid:TheFinePrint
TellingQuestionstoAsk• What’syourtotalfinancialaidbudget?
• Whatpercentofyouraidbudgetisusedformerit-basedaid?
• Whatwereyouraverageaidpackagesforlastyear’sincomingclass?
• IfIreceiveanoutsidescholarshipafterIreceivemyinitialaward,whathappens?
Stay in Touch!
Shelley Kierman
Ross D. MankutaMilken Community Schools
Charlie LeizearDirector of First-Year Admission
Occidental College