A majority of students and their parents have ruled out colleges based solely on published sticker prices without considering how much financial aid they might receive, according to a recent survey of college applicants. Most students and parents said they had not used online financial-aid calculators to determine how much they would need to pay at different colleges.
The findings come from the latest installment of Student Poll, a collaboration between the College Board and Art & Science Group, a firm that specializes in strategic marketing and planning for colleges. The survey, conducted in late November and early January, was designed to reveal how students’ perceptions of affordability had shaped their thinking about colleges.
Above all, the survey’s results suggest that many families make college choices without accurate or sufficient information. Fifty-nine percent of students said they had looked only at the sticker prices, while only 28 percent said they had considered the net tuition price of a college after determining what they might receive in financial aid. About 12 percent said they had not considered the cost of any college.
Next year, the federal government will require all colleges and universities to provide net-tuition calculators, which help families determine what they are likely to pay in net tuition, minus scholarships and need-based grants the applicant would likely receive from an institution. Yet only 26 percent of respondents said they or their parents had used one of the financial-aid calculators currently available, while 58 percent said they had not used one.
Moreover, students from high-income families made greater use of aid calculators than those in the lowest-income group (25 percent compared to 8 percent). In wealthier families, students were more likely to report that their parents had used the calculators; in the lowest-income group, students were the ones most likely to have used them. And among those who reported that they, their parents, or both had used aid calculators, a third said they were easy to understand, a fifth said they were not easy to understand, and 45 percent said that some were easier to understand than others.
As anyone who works in the admissions realms knows, choosing a college is not always a rational process. The same is true of perceptions of affordability. Although many respondents said they had ruled out colleges because of price, many students said they were willing to stretch themselves financially to attend colleges they perceived as expensive if those institutions offered something they valued highly, such as a specific academic program, a vibrant social life, or prestige.
Yet the survey’s findings also suggest that many respondents have unrealistic expectations about the amount of aid they will receive. Ninety-three percent of respondents said they planned to apply for financial aid. Of those students, 51 percent expected to receive need-based aid, 56 percent expected to receive merit-based aid, and 30 percent expected to receive some kind of aid for their personal achievements.
One striking finding: Nearly two-thirds of students with SAT scores of 1250 or higher expected to receive merit aid. Almost as many respondents with scores between 1000 and 1240 expected to receive merit aid, and so did about 45 percent of students with scores 1000 or below.
The widespread availability of merit aid seems to have created “a climate of expectations” among applicants, says Richard A. Hesel, a principal of Art & Science Group: “You have this sticker-price fear, but there’s also a lot going on that raises students’ expectations about what they’re going to get. I’ve seen this for a long time, and it’s gotten worse.”
Students also had high expectations about how far their grants and scholarships would stretch. On average, they anticipated that grants and scholarships would cover 35 percent of their college costs, with loans covering 21 percent, family or personal savings covering 17 percent, and 24 percent coming from the family’s earnings during college.
Despite students’ concerns about paying for college, most believed that their families would find a way to overcome financial challenges. Twenty-eight percent said that “My family and I will have to stretch a lot to afford to send me to college, but I think we’ll make it.” Among students who were not certain or who said it would be difficult for their family to afford college, 24 percent said they would “work something out when the time comes” and 15 percent said their family “would try anyway.”
The findings add up to a complicated picture. On the one hand, it reveals students’ optimism about attending college despite financial hardships. Yet the survey also suggests that many might lack accurate or sufficient information about paying for college. That said, the findings also suggest that colleges have plenty of work to do in educating prospective students and parents about the admissions and financial-aid process.
“A lot of students and parents stretch more than they should, and then they get into trouble, and this leads to retention problems,” Mr. Hesel says. “A college education is such a desirable goal, and people want it so much, there’s a lot of wishful thinking that happens.”