A Growing Opportunity for Merit Scholarships

A Growing Opportunity for Merit Scholarships The number of families willing to pay $80,000 to $90,000 or more for a private university is dwindling. The Wall Street Journal recently published a front-page story revealing the fiscal troubles that Syracuse University is experiencing as it struggles to attract enough teenagers to fill its freshmen class. Syracuse is hardly alone. Many lesser-known private colleges and universities have been failing to achieve freshmen enrollment goals for years. What made the Syracuse news notable is that mid-tier, name-brand universities used to be relatively protected from this sort of dilemma. Syracuse, however, illustrates this reality: The number of families willing to pay $80,000 to $90,000 or more for a private university that enjoys a few standout academic disciplines and a well-respected reputation is dwindling. Syracuse’s travails might be a surprise to people who thought that higher-ed financial struggles were confined to small private colleges and universities with little name recognition. While small colleges in the Northeast and Midwest have been the ones experiencing the biggest higher-ed pain, respected mid-tier private universities have been pulled into the category too. Private mid-tier universities, typically ranked between 40 and 120 in the U.S. News & World Report national university rankings, that are experiencing fiscal and admission pressures include Drexel University (Philadelphia), American University (Washington, D.C.), Marquette University (Milwaukee), Brandeis University (Waltham, Mass.) and DePaul University (Chicago). The growing circle of higher-ed institutions that must turbocharge their admission efforts can benefit your clients as merit award opportunities grow and expand. New Merit Award Realities Here are a few things that families should keep in mind: Colleges and universities that need to work harder to meet freshman quotas must award more merit scholarships. I think many people would be amazed at the percentage of students who receive institutional money from private higher-ed institutions. According to the latest annual survey of the National Association of College and University Business Officers, a whopping 90% of freshmen receive institutional money from private schools. The average institutional grant awarded to freshmen covered 63.3% of published tuition and fees. Institutional money can come in the form of need-based aid and merit awards. In sharing those plentiful and generous discount statistics, a disclaimer is always necessary. The Ivy League schools and other top-ranked research universities, such as Stanford, Massachusetts Institute of Technology and the University of Chicago, offer little or no merit aid. That’s because rich parents will pay full price for a prestigious trophy school. Also in this category are schools that aren’t in U.S. News & World Report’s top 25 national universities but are blessed with locations in major East and West Coast cities that are catnip for wealthy students. New York University, University of Southern California, Boston College, Northeastern University and Boston University attract a large percentage of wealthy students who pay the full price. Schools like Syracuse, which used to attract many more full-pay wealthy students, have to sweeten their offers to assemble their freshman class. For instance, Syracuse doles out institutional money to roughly 80% of its freshmen, which is below the NACUBO average but higher than historically. In contrast, Boston College (it’s a research university despite its name) provides institutional aid to only 40% of freshmen. When you see a school with an institutional aid percentage that low, it means the vast majority of aid or all of it is dedicated strictly to need-based aid. Diving Into Merit Aid Statistics So, how do you determine what the merit aid and need-based aid practices are at an individual college or university? I’d highly recommend that your clients check a school’s Common Data Set. A Common Data Set is a standardized document created to address the voracious appetite for higher-ed data from collegiate publishers like US News & World Report and the College Board. Rather than answer every publisher’s annual questions on such areas as freshman admissions, financial aid, merit aid, college majors, acceptance rates and transfers, many schools complete this form. When researching how generous a college or university is with institutional merit and need-based aid, your clients should check out Section H of any school’s Common Data Set. This illuminating section will help parents assess whether a school is typically generous to students who require need-based aid or seek merit aid. For students who will not qualify for need-based aid, section H2A will be the most important. This section reveals how many high-income students receive merit scholarships and what the average amount is. It used to be that families would have to search individually for each school’s Common Data Set, but that is no longer necessary for hundreds of schools. College Transitions, a national college consulting firm, has done everyone in the college space a favor by creating a repository of Common Data Sets. Read more about: