College Choices for Affluent Families

A mom emailed me earlier this week and I’ve somehow managed to stretch out the topic of her concern to three posts. If you’re curious, here are the previous ones:

Who Is Stressed Out About College?

Do You Really Expect Me To Pay That Much for College?

Today I’m going to address her chief question:

What do you do if the financial aid formula considers you affluent, but you don’t have the financial ability to pay full price? I suspect that plenty of people who visit my college blog are grappling with the same question.

This mom’s Expected Family contribution is high. Depending on the methodology, it ranges from $37,000 to $44,000. Many families are shocked at their EFC, but keep in mind that the federal EFC is a creation of Congress.

Paying for College When Your Considered Affluent

Here are a few of my thoughts on this issue:

1. Just because a family has a high Expected Family Contribution, doesn’t mean that they will pay full price.

This mom, or any other family with a high EFC, could look for schools that provide merit scholarships to affluent students.  Nearly all schools fall into that category.

It’s far easier to identify the schools that don’t offer merit scholarships to rich students than name those that do. There are probably only two or three dozen schools at most that don’t provide merit scholarships. As I mention in the second edition of The College Solution, the scholarship-free institutions are the nation’s most elite schools including the Ivy League members.

Check the top 10 institutions in US News’ prestigious national university and national liberal arts college categories and you’ll have a great idea of which schools don’t dispense merit scholarships to wealthy students.  Many of these schools don’t offer merit scholarship to rich students because they can easily attract these students without help. If their US News rankings ever started slipping (highly unlikely because of how the methodology is rigged), I’m sure they would start dispensing them.

MIT (a school on the  dream list that the mom shared) doesn’t offer any scholarships to rich students, which is no surprise because it is ranked 5th in the college rankings. Stanford and CalTech, also tied at No. 5, represent a slightly different approach taken by some highly elite schools. Stanford and CalTech, along with schools like Carleton College ($3,368), Bowdoin College ($1,000) and Northwestern ($2,521) offer very modest scholarships to rich students.

When I checked the Financial Aid section of Stanford’s Common Data Set (21011-2012), only 87 wealthy students out of a freshman class of 1,674 received a merit scholarship (non-need-based aid in higher-ed lingo) and the amount was a modest $4,985. The average merit scholarships for rich students at CalTech was $5,000.

2. A high EFC can still generate need-based financial aid.

This family, assuming that their child got into these elite schools (and that’s a huge assumption), could still be in line for financial aid at schools that are extremely expensive. For instance, the cost of CalTech is more than $56,000. The son could receive need-based aid that would close the gap between the family’s EFC and the cost of the school. If the family’s EFC was $37,000, that would mean an aid package of $19,000.

3. Rich families should broaden their search.

This advice actually is relevant to families of all income. If you are in need of financial help, students should look for schools that would be excited to have them in their freshmen class. Rather than looking for schools where you’d barely get in, search for schools where you’d be in the top 25% to 33% of the incoming class.

Colleges have finite amounts of money and they will reserve their best awards to their most coveted applicants. If you are wealthy, your child’s chances of getting large merit scholarships are much greater if you look beyond…..

4. Consider state universities.

If the cost is too much to absorb, consider your own in-state public universities. If a child receives a merit scholarship at a state school, chances are the price will be quite reasonable. I don’t see the point of going to a private institution if it would require great hardship on the part of the parents and/or the student.

Any other ideas?

If you have any other suggestions on this topic, I’d love to hear from you. Just send your comment in the box below.

And Happy Memorial Day!

Lynn O’Shaughnessy is the author of second edition of The College Solution: A Guide for Everyone Looking for the Right School at the Right Price, which was released this month.

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  1. In working with families with a high EFC, I find many tend to waffle. On the one hand they want their child to attend a prestigious school, while on the other hand they don’t want to pay for it. In essence they want the bragging rights that come with an admission to a highly selective school but they also want the recognition for great grades, test scores, extracurricular involvement, etc in the form of a large scholarship. I have seen parents flip flop weekly on whether they want the child to shoot for prestige OR big scholarship. So, my advice to Linda is to do your homework and find some schools that give merit and that would be a terrific match for your son AND also have him apply to those highly selective, no merit schools mentioned in the post. IF – and it’s a big IF – your son gets in to a Stanford or Caltech, you’ll need to have some serious discussions about finances, and you’ll need to weigh the +’s and -‘s of prestige versus lower out of pocket cost. But at least you’ll have viable options. In the process of investigating schools that award merit $, I’m hoping that you’ll keep an open mind and that you’ll discover that there are lots of excellent schools out there that would love to pay your son to attend.

    1. We are a family that absolutely falls into the category you describe, those that desire a highly select school but want to be rewarded with scholarships for acedemic acheivements in high school. We are trying to be realistic in our search. The select schools are easy to identify. However, we are having trouble creating a list of 2nd tier schools that will want our child enough to provide a substancial merit package. If someone can help me by identifying good websites and critera for identifying these schools, I would be very grateful.

      1. Hi Christie,

        The good news is that the vast majority of schools give merit aid to rich students. There are plenty of posts on my blog that talk about how to find schools. I also discuss this topic in the second edition of my book, The College Solution: A Guide for Everyone Looking for the Right School at the Right Price.

        Read today’s post for ideas on how to find colleges. I’ll also be talking about this topic in tomorrow’s post.

        Also, as I mention in my book, I like the lists of colleges (Forbes rankings) that are compiled on the Center for College Affordability and Productivity website.

        Good luck.

        Lynn O’Shaughnessy

      2. Christie, I recommend using a search engine (Lynn mentions several in her post today) to find schools that have the major(s) your child is considering. Then start investigating! When you go to a school’s website, type in “merit scholarships” in the search bar. That will usually take you to a description of what scholarships and amounts are offered and what you need to do to be considered. For many schools, your general application is all that is required. (Look at small liberal arts colleges – they tend to give generous awards.) A good site to check out is It lets you enter parameters and / or allows you to investigate what merit scholarships a particular school offers. Good luck!

      3. Christie, we followed Lynn’s advice and our son had large merit aid awards. After we identified possible schools that were a fit for his interests, we used the 75th percentile SAT scores as a simple guideline. He kept the list to schools where he was at or above each of those numbers. This proved to be a reliable indicator of both acceptance and merit aid awards, although his awards did vary between schools–without any correlation we could see. With a short list, he was able to visit every school junior year before applying, and went back to his first choice for a senior year interview. He did get into his first choice and that was his largest merit offer, so targeting as well as showing your serious interest were a great combo for us.