Three Case Studies

College Affordability Case

Studies to Inspire You

2014-15 Winter Webinar Series

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The answer is “Yes”.

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Your Hosts

Jeff Levy, CEP-Certified Educational Planner & graduate of UCLA College Counseling program

-In private practice since 2007

-Passionate about empowering students to discover their own paths

-Believes affordability should be part of the college search and planning process

-www.personalcollegeadmissions.com

Cyndy McDonald, MA/PPS-MS in Education/PPS credential

-Over 20 years experience in schools & in private practice

-Founder and President of GuidedPath

-Committed to helping all students reach their potential

-www.guidedpath.net

Why look at 2 case studies to learn about affordability?

1. Learn how to evaluate a family’s financial profile.

2. Learn where a family may find their best sources of

aid.

3. Learn how to build a smart college list taking the

family’s financial profile into account.

Evaluating the family’s financial profile

A family’s ability to pay is determined by their

answers to the FAFSA and the CSS/PROFILE.

But the family doesn’t learn their actual net price

– as compared to sticker price – until very late in

the process.

Knowledgeable counselors can assist families

early in the process.

Need = COA - EFC

Need is defined as the difference between a

college’s total Cost of Attendance (COA) and

the Expected Family Contribution (EFC).

Resources for families to calculate

EFC:

-Net price calculators on websites

-College Affordability Shaper survey on

GuidedPath

-FAFSA4caster

-College Board

-Others?

#1- Start with calculating an EFC

Next steps

Know your EFC

Know the college Cost

of Attendance

Calculate your “need”

CSU Los

Angeles

Univ. of

California

Los Angeles

Chapman

University

Good place

to start with

Affordability

Net Price calculators on each college website

•To predict a student’s chances of

admissibility into an institution, we

familiarize ourselves with admit rates,

average tests scores, GPA range, and

other attributes of fit.

•To predict a client’s eligibility for aid

from an institution, we must know a few

of its financial attributes.

Admissibility and Eligibility

Evaluating a college’s generosity:

What percentage of need does

it meet?

What is the average amount of

merit aid it awards?

What percentage of undergrads

are receiving merit aid?

Understand a College’s Financial Profile

Financial Aid Offered demonstrates a college’s

STRATEGIC ENROLLMENT MANAGEMENT approach

Learn more from College Affordability: An Insider’s Look at http://youtu.be/jEjAM4vYmgo

College Avg Amount of

Need Met

Avg Undergraduate

Merit Award

Undergrads

Receiving Merit Aid

Princeton 100% $0 0%

Carleton 100% $2,757 4%

Davidson 100% $22,426 4%

USC 100% $17,953 20%

Oberlin 100% $12,627 42%

Denison 95% $17,210 42%

Wooster 94% $19,314 35%

RPI 85% $13,794 21%

U of Miami 76% $20,240 22%

NYU 72% $8,787 3%

All data from Guided Path and U.S. News & World Report, 2014

Which colleges meet close to 100% of need?

These tend to remain the same year to year, but not

necessarily.

These tend to be the most selective colleges, but not

always.

Use GuidedPath to search by “100% of need met”.

Other databases and consulting programs have a

version of this information.

Surprise!

Some of the schools

showing full need met may

be surprising.

“Full Need Met” is a relative term

From college search on GuidedPath

Let’s meet our two families.

Claire Long family. They have zero need.

Income $215,000

Marital status married

Age of older parent 45

Number of children 1

Home equity $500,000

Non-retirement savings $75,000

EFC $73,000

• GPA 4.0 (unweighted)

• Rigor many AP/Honors

• SAT 2240

• EC viola

• EC Investment Club pres.

• EC Congressional intern

• College BA (mother and father)

Claire Long Family

• Because of their relatively high income and home equity, Claire will be

ineligible for need-based aid even at the most expensive colleges.

• The equity in their principle residence has grown rapidly because they

have owned for many years in a neighborhood where property values

have soared. But their cost of living has risen as well.

• It will be impossible for them to meet the sticker price of a private

institution without dipping substantially into their savings, something

they don’t want to do.

• The Longs expect that their high-achieving child will attend “an Ivy

League university” and hope that it will lead to greater opportunities

for her.

• Claire is a National Merit Scholar, but the Ivies do not dispense merit

aid. That award may help her admissibility but will not lower the net

price at the Ivies and similar schools.

• The Longs assume that Claire’s achievements would win her enough

“scholarship money” to help make one of these expensive

institutions affordable.

Let’s see what Princeton, Yale, and

Oberlin might actually cost them.

Claire Long Family

Princeton Yale Oberlin

COA $61,275 $63,250 $64,200

EFC $60,200 $73,000 $73,000

Need (COA – EFC) $1,075 $0 $0

Avg Need Met 100% 100% 100%

Unmet Need $0 $0 $0

Federal Student Loan $0 N/A N/A

Out of Pocket Cost $60,200 $63,250 $64,200

Merit Possibility no no high

•In spite of the Longs’ wishes for Claire to enroll at an

Ivy, these give no merit aid whatsoever.

•Certain PROFILE schools like Princeton, Bard, and

Carleton do not look at home equity in the calculation of

financial need and could lower their EFC by many

thousands of dollars.

•Colleges that only use the FAFSA and not the

PROFILE do not consider home equity in the principle

residence and can result in a substantially lower EFC for

the family.

Claire Long

•The Longs will either pay full sticker

price at an Ivy—with some variations

between schools based on how they

assess home equity—

OR

•They will have to look one tier down

for merit aid.

Claire Long

But how terrible an outcome is that?

Lesson

Families with no demonstrated need who will

have a difficult time meeting their EFC should be

looking at colleges that are generous with merit

aid.

Lesson

In one of the ironies of higher education, the in-state

public institutions have become sensible financial

choices for families who do not qualify for need-based

aid. Regrettably, they are also becoming largely

unaffordable to the population they were set up to

serve—families with the greatest amount of need.

Which colleges are generous with merit aid?

These tend to remain the same year to year, but

not necessarily.

Several of the databases and consulting

programs we work with will have this information

in the financial aid section of each college.

These tend to be one or two tiers below the most

selective colleges, but not always.

Michael Green family. They have moderate need.

Income $130,000

Marital status married

Age of older parent 42

Number of children 2

Home equity $300,000

Non-retirement savings $50,000

EFC $36,000

• GPA 3.4 (unweighted)

• Rigor a few AP/Honors

• SAT 1950

• EC horn (state honors)

• EC Key Club vice president

• College father – MSW

• College mother – BFA

Michael Green Family

• Their EFC from income alone would entitle them to significant need-

based aid, but the equity in their principle residence will raise the EFC

substantially.

• Their non-retirement savings are relatively low compared to the cost of

putting two kids through college.

• In addition to the worry over how to afford college, the parents are

concerned that Michael’s GPA will make him ineligible to receive any

financial aid at all.

• Michael is an excellent horn player and wants to continue performance

at the college level, but he may not be admissible at the most selective

music conservatories.

• He is unsure whether to apply to music conservatories or to liberal arts

colleges with strong music programs.

Let’s see what Ithaca College (a

conservatory), Puget Sound (building a

strong music program), and Wooster

(looking for musicians) might actually

cost them.

Michael Green Family

Ithaca Puget Sound Wooster

COA $57,000 $58,000 $57,000

EFC $36,000 $36,000 $36,000

Need (COA – EFC) $21,000 $22,000 $21,000

Avg Need Met 86% 74% 94%

Unmet Need $2,940 $5,720 $1,260

Federal Student Loan $5,500 $5,500 $5,500

Out of Pocket Cost $38,940 $41,720 $37,260

Merit Possibility no high high

•Because Puget Sound is aggressively building its

music program, Michael has a high probability of

receiving substantial merit money there.

•Wooster is a college that offers music scholarships as

well, and could be a good financial choice though

possibly not quite as strong a music performance fit.

•His most expensive option will likely be Ithaca where

he is not a standout applicant.

•Colleges that meet close to 100% of need but do not

offer merit aid may not offer enough assistance to the

Greens.

Lesson

Families with moderate need and low

relative savings will usually require

colleges that meet a high percentage

of need and are also generous with

merit aid.

Which colleges meet a high percentage of need and are

generous with merit aid?

Most of the databases and consulting programs we work with will

have this information in the financial aid section of each college.

These tend to be institutions just below the top tier but trying very

hard to get there.

In order to suggest colleges that are

smart financial options for our

families we should…

Conclusion

Conclusion

1. Help them understand their family’s financial profile in terms of demonstrated need. Are they high, moderate, low, or no?

2. OR in our terms, Whole, Half-Half, or Merit?

3. Help them understand the kinds of colleges where they will be eligible for the greatest amount of aid.

4. Help populate their college list with a smart mix of colleges that maximize the probability of aid.

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