In a story that published today, I discuss a trend in college admissions: applicants turning down a first-choice college for a second or third choice that offers more merit aid.
Tuition discounting stands at an all-time high. The average applicant reaps a 42 percent discount in the private college sector, meaning she or he pays just 58 cents on the dollar of published tuition and fees. That’s an average for all applicants, including those who receive no aid at all.
Colleges are dispensing more aid of every sort. It’s hard to tell precisely where need-based aid ends and merit aid begins, because schools define them differently. But every survey and anecdote in the industry points to merit aid as a dominant force in today’s college admissions cycle.
Applicants, in turn, are putting value before prestige, and paying full price only for top-drawer institutions.
“Even before the Great Recession, consumers were starting to focus more on institutional value than prestige,” said Tony Pals, spokesman for the National Association of Independent Colleges and Universities. “The reason: sticker price fatigue.”
Colleges offer merit aid on a sliding scale, depending on how much the school wants the applicant and how much the student wants the school. The largest aid awards presumably go to the most sought-after applicants who haven’t made their intentions clear — say, by applying Early Decision.
“As counselors, we’ve been telling families for a long time that if you’re hoping for merit aid, you’re not going to get it at the schools that you’re fighting your way into,” said Lisa Sohmer, director of college counseling at Garden School, a private college preparatory school in Queens. “I’ll say this: The more a college wants you, the more likely it is that you’ll be eligible for merit aid at that institution.”
A few dozen colleges at the top of the heap eschew merit aid and make all awards according to need; all aid awards are decided by the same formula.
Merit aid is a vital tool for hundreds of colleges operating just below the top echelon. Very prestigious schools, including Johns Hopkins, George Washington and Oberlin, offer some form of merit aid.
The main character in my story, Silver Spring student Gillian Spolarich, chose the College of Charleston over American University because Charleston offered considerable merit aid. (AU offers merit aid but offered none to Gillian, presumably because her strong academic transcript placed her close to the middle of the applicant pool there.)
In response to today’s story, one parent wrote:
My daughter is interested in very competitive schools and we were hoping that applying to UVA and Tech as safety schools might get the top schools (Columbia, Northwestern, Cornell ...) to offer merit aid but it sounds like they don’t have to. Do you know how to find which schools are offering merit aid, particularly for girls in engineering?
Many Web sites offer tips on merit aid; in a quick Google search, I found several entries on the well-regarded College Confidential site as well as numerous references in the pages of the U.S. News rankings.
Columbia offers no merit aid; it is one of those elite institutions that offer only need-based aid and claim to meet the full demonstrated need of applicants. Northwestern, according to its Web site, offers very limited merit aid. Cornell avoids merit aid.
A student applying to any of those schools will get the same consideration as every other applicant, at least in theory, with aid awarded in direct proportion to financial need. But none of them is likely to sweeten the deal with merit aid.
Another parent wrote,
I’m curious to find out how the parents went about putting their top schools into polite bidding with each other. Was there a particular strategy they employed?
The students I interviewed generally did not engage colleges in a bidding war in the way that one might, say, play one auto mechanic off another. The “bidding war” played out as each college made its best offer to the applicant, judging how much financial incentive it might take to persuade the student to attend.
But many families are becoming wise to the merit-aid process. College presidents have become accustomed to taking calls from parents asking them to essentially match a competitor’s price.
If anyone can offer better answers to those questions, please hold forth in a comment.