Leveling the field: Ivy League Financial Aid

In the past few weeks, “Lin-sanity” has gripped the nation. After leading the Knicks to seven straight wins, Lin seems to have cemented his role as a star player, something few people saw coming. A fact that most people aren’t aware of: Jeremy Lin is the first NBA player out of Harvard since 1954. Many sports fans have been surprised to learn that Lin is a Harvard graduate, because the Ivy League schools have hardly been known for their athletic programs. Until now.

Thanks to improved financial aid policies, which make attending Ivy League institutions affordable for middle class families, the Ivies are once more athletically competitive. These policies make it easier for the Ancient Eight to recruit elite athletes, a task they largely failed at for much of the last century. Because the Ivy League does not offer athletic scholarships, they have never been able to compete with schools like Duke or Notre Dame when it comes to recruiting athletes. This practice has meant that Ivy League athletes tended to either be relatively wealthy or relatively poor – in either case, money is no longer an issue – and this socioeconomic division limited the pool of potential athletic recruits, resulting in languishing athletic programs for many Ivy schools.

In recent years, however, most of the Ivy League universities have all but eliminated student loans by nearly doubling the size of grants available to middle class families. At Harvard, for example, new financial aid policies cap the percentage of income a family is expected to contribute; now, a family earning $120,000 to $180,000 contributes no more than 10% of family income to college tuition.

These new policies have had consequences far beyond the basketball court or the football field. Just as improved financial aid policies have made it easier to recruit top athletes, these same policies have allowed Ivy League schools to compete for top students who might otherwise have gone to a less expensive public or private college.

The Ivy League schools are at a distinct advantage when it comes to recruiting students. At nearly all colleges and universities, the operating costs per pupil outpace the money the school actually gets in tuition. At public schools this gap is filled with state funds, and at private schools the gap is filled by endowments. In either case, the school is limited by its funding. But at Ivy League schools, the endowments are massive. In fact, on a list of the top ten richest schools in the country, 5 are Ivy League schools. Harvard, by far the richest school in the country, has an endowment worth $32 billion, $13 billion more than Yale, the second richest school in the country. Other elite private schools have impressive endowments, but they simply don’t have the same resources as Ivy League schools. In order for a private school to match the Ivy League’s generous financial aid offers, they would have to cut services, potentially harming the quality of education. Meanwhile, Ivy League schools are not only offering impressive financial aid packages, but also spending billions to improve their campuses and course offerings.

This situation effectively gives the Ivy League a monopoly on the most talented students in the country. Once upon a time, talented students from middle-class backgrounds were lured to public institutions which offered low tuition rates; today, these same students are finding that an Ivy League education can be even less expensive than a public school education. The long term consequences of this trend have yet to be fully realized, but with roughly ¼ of Ivy grads flocking to Wall Street, we can predict a cycle of wealth disparity in higher education: Ivy schools lure in top students, these grads go to the financial sector where they earn high salaries, and these wealthy alums donate to the Ivy League institutions thereby further increasing their already robust endowments. The rich schools will get richer while other schools struggle just to keep up.

So what do these trends mean for your child?

  1. An Ivy League Education Is Affordable: If your child makes the cut, an Ivy League education can now be less expensive than a public school education. Middle-class families shouldn’t be turned off of an Ivy League school simply due to sticker shock because those $50,000 price tags aren’t really accurate.
  2. Competition Is Stiffer Than Ever: Because an Ivy League education is now fairly affordable, the pool of applicants has widened considerably. This helps to account for the record breaking numbers of applicants at Ivy League schools over the past few years. But because Ivy League schools are financially accessible for more students, applicants have to be more impressive than ever before in order to stand a chance of earning admission.
  3. Student Athletes Can Go to an Ivy League School: Ivy League schools have used their improved financial aid policies to target talented athletes; however, since the schools cannot offer athletic scholarships, athletes must still have impressive academic credentials. Jeremy Lin, for example, was not only a talented basketball player – he also graduated high school with a 4.2 GPA. Instead of pinning college hopes on an athletic scholarship at a less prestigious school, your child should utilize their athletic prowess to gain an edge in admission at an Ivy League school. Student athletes will still need stellar grades and test scores to earn admission, but athletic ability is now a bigger plus than ever before.

In short, an Ivy education is both easier and harder to obtain – it’s easier to afford, but harder to get in. Rather than allowing your child to be discouraged by such news, you should use this information as motivation – by working hard and earning the best grades and test scores possible, your child can obtain an amazing education at a prestigious university. Make sure to give your child the guidance necessary to compete for admission at the Ancient Eight – start here at C2’s blog with some of our most popular past posts:

And for Asian-American students, Jeremy Lin offers additional lessons. As we’ve written before, earning admission in the Ivy League can be even more difficult for an Asian-American applicant than for other applicants. But by following in Lin’s footsteps and cultivating an athletic talent in addition to a strong academic background, Asian-American students can help to break out of the Asian stereotype – something which can help overcome the Asian-American bias in Ivy League admissions.

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