Long before you start filling out college applications, these days you have to start deciding how many AP classes you’ll need to take before your freshman year of high school . But do you really “need” to take a bunch of AP classes to get into a good college? The answer for attending an elite or Ivy League school is “maybe.” In my last post I looked at the chances of getting into an elite school, even with a steller resume. But assuming you get in, you then have to consider what an Ivy League education would cost? What are the chances of getting a merit scholarship?
What is the cost of attending an elite or Ivy League school?
Well, the tuition at Stanford is currently $45,729 per year.
But don’t forget to look at a cost that includes textbooks and living expenses. Different schools in different cities will different housing costs. Sometimes schools will call these numbers something like “student budget” or “total annual cost.”
With living expenses, they estimate the cost of going to Stanford is at least $64,477 per year.
That’s a minimal total cost of $258,000, assuming my child graduates in 4 years.
We have three kids, so let’s multiply that number by 3.
That gives us a total cost of $775,000. That’s over three-quarters of a million dollars. Without even looking at ROI for a college education – return on investment, what it would take over time to recover the cost of the education – (And here’s an article about further analyzing those statistics for college ROI), you still have to have the money to be able to spend it.
Maybe our kids will get financial aid.
Before we get into financial aid, let me point out that I do not consider student loans to be financial aid. Be warned, colleges do! When you find information on “actual costs” they will have deducted student loans from that cost. But really all loans do is it make college more expensive, because of the cost of interest. For a great explanation of how tricky financial aid can be, and how schools use loans as “aid” to lower their apparent costs, check out 5 Ways to Get Smart About Financial Aid Award Letters.
Many of the elite colleges, such as Harvard, now highlight their “need based” financial aid. It can help to know that your idea of need, and a college’s idea of how much you can afford to contribute to your college education, can be very different. (What is EFC (Expected Family Contribution)?) And so if you’re looking at ROI, as explained above, you are still looking at the bottom line of how long it takes you to recover the cost of the education without need-based aid.
Let’s assume that we won’t get any need-based financial aid, and look only at merit aid. (We are not destitute by any means. But 3/4 of a million dollars is still a lot of money to us!) For a good article on trying to predict your chances of merit aid, read How to Find Merit Scholarships: Follow the Money. (And if you want to find colleges that increase your chances of getting merit aid, here is a great resource 50-50 Highlights: Best Colleges for Merit Scholarships.)
Stanford gives out merit awards to 1% of their incoming students.
Well I guess those are better odds then winning the lottery.
But still, a 5% chance of getting accepted and then a 1% chance of getting merit aid – I don’t know about you, but with 0.05% chance any one of my kids would get into Stanford and be offered a merit scholarship, it’s not too likely that one of my kids would go there.
Of course some kids do get into the highly selective schools and a few of them do get fantastic scholarships, often need based. It’s even more amazing when that happens, because the numbers just aren’t in their favor of getting in at all. But, if that’s important to a student, it is worth a try!
But before I totally discard the idea of my kids attending an elite university, there’s one more thing to consider. Do the calculations match up to reality? I’ll share what I’ve heard in my next post.
Ivy League schools (and probably Stanford – I don’t know for sure) don’t give out merit aid because all of their students would be eligible to receive it. Instead, they use their endowments to help their students. At an Ivy League school, the students family is expected to pay their EFC. Beyond that the cost is covered by grants. That means that even for an upper middle class family, there is likely to be financial assistance and may very likely make the Ivy League education cost less than the State school. I know, as that was the case of us.
That does make sense that all of their students would qualify for merit aid. And it’s really interesting that it might make the Ivy League education cost less than the State school; EFCs tend to be so high that I’m surprised by that. What I would guess might still be true, is that while it might cost less than a state school, it might not cost less for that particular student than a state school if they would get aid at the state school. However, if your student really wants to go to a particular school it is encouraging to know that it might not be out of reach! It’s really great to get first-hand information. Thanks for commenting!
If you truly have a stellar student, I would highly encourage them to look at the Ivy League schools, especially if they come from a lower income family. Ivies typically cost nothing for kids whose families make less than $60K/year. Unfortunately, those families are the ones that typically get scared off by the huge sticker prices and miss out on the fabulous opportunities afforded by an Ivy League education and the connections that come from it. That is why I had to comment on your article. It is deceptive and wrong to assume you won’t receive financial aid from an Ivy, unless you make upwards of $200,000/yr. If you are under that income level you WILL receive aid in the form of grants, which will NOT have to be paid back. More importantly, if you have two students attending college at the same time, their EFCs at an Ivy will half and the university will still only expect you to pay your EFC and still meet the difference between your EFC and the sticker price with grants that will NOT have to be paid back. That’s true, even if your second student has received lots of scholarships at their college. The Ivy doesn’t care how much you’re paying at the 2nd college, just that you have another student in college. Parents need to be sure they look at the cost of four years of college and how a sibling changes the equation. As you can tell, I find your article highly inaccurate and I would hate for a great student to miss out on a once in a lifetime opportunity because they are told that can’t afford it.
That’s great to note that aid depends more on the number of students a family has attending college than on how much each is actually paying. Thank you for pointing that out! And you’re right that students shouldn’t limit their search too much and miss out on opportunities.
However, when looking to balance the high school experience, it’s good to know that you don’t need to take a staggering number of AP and IB classes to get into a “great” college, but you probably will need to in order to get into a highly selective school like an Ivy. Thus the calculation of how likely you are to get in, and also how likely you are to get financial aid. Please note that in the article only 1% of students at Stanford get financial aid. However, as you are right that students shouldn’t miss out on opportunities so let’s look at this some more.
The fact that parents and students on average are expected to contribute more than they can find in their budgets is reflected in rising student debt. From A Look at the Shocking Student Loan Debt Statistics for 2017, https://studentloanhero.com/student-loan-debt-statistics/, “…the average Class of 2016 graduate has $37,172 in student loan debt, up six percent from last year.”
But you are again right to point out that you need to focus not on sticker price, but on net price. This varies by student, so the best you can do to plan is to look at average net price. NPR has an excellent article about this, What You’ll Actually Pay At 1,550 Colleges. http://www.npr.org/sections/money/2015/09/30/444446022/what-youll-actually-pay-at-1-550-colleges From their calculator, you can see that for an income of $110K, the average net annual price for Stanford is $40K, for Texas A&M $19K, University of Arkansas $15K.
However, for very low incomes you can get a very low price at many different colleges! And the curve is flatter at public schools, so you do get a bigger break at private. And that is important for low income students to know that.
After I look at the data, I then try to match it with personal experience. (I don’t trust data alone.) We,personally, are not seeing friends get good financial aid packages from highly selective schools, compared to others schools, IF the get in at all. And their kids are burning themselves out with heavy class loads, extracurricular activities, and lack of sleep.
First of all, Stanford has just announced that all students with families that make $125,000 per year will attend for FREE.
Second, I think college debt is so high because parents and students are not doing their homework beforehand when targeting their choices of schools. They assume the state school will be the least expensive and only apply there. Then they are shocked by what they will be paying – once it’s too late to change course.
You state that “all you can do is loo at the average net price.” False, by law every school is required to have a Net Price Calculator on their website. If parents use these and provide accurate numbers, they will have a very good idea what their worst case cost at each school will be. Then, if they are lucky, they might still receive merit aid to reduce the cost.
Another effective way to reduce your cost is to target a school that is just below your grades/test scores. That is what we did with our 2nd son. He is a strong student, but was not Ivy League material. By choosing a good school where his test scores and grades were above the average, he was able to get merit aid to the tune of $31K/yr. for 4 years. We have several friend who have found this to be true. One has just committed to Alabama (and their Honors College) where he will get a full ride because his ACT was 32 or higher.
There are deals to be found for good students whose families make less than $200K, you just need to know how to find them.
Obviously, you are correct that some kids are burning themselves out taking too many APs, participating in extra-curriculars, etc. Some indeed are doing so. But those kids are not the ones that should or would end up at an Ivy. Since your article spoke to cost of Ivies and elite schools, this really doesn’t fit into the discussion here.