Private Colleges Offer Merit Scholarships as Tuition Discount
The costly prices of private colleges and universities keep getting higher.
Here is something, though, that you might appreciate about the cost of these colleges: The vast majority of students aren’t billed for the full tab.
About 88 percent of students who attend private institutions don’t pay the published prices, according to the latest statistics of the National Association of College and University Business Officers.
For any of you hoping to apply to a private college this figure should give you hope. If 88.2 percent of incoming freshmen are getting discounts, they clearly aren’t just for top students.
Here’s another hopeful statistic from the NACUBO’s annual tuition pricing survey: The average tuition discount for first-time, full-time freshmen at these private institutions is 55.5 percent, which is at an historic high. (The average tuition discount for all undergraduate students is lower but still high.)
Here’s an example of how the discount works:
Average Discount Rate
Private College Tuition
Why are so many students receiving merit scholarships and grants from private institutions?
One primary reason is most private institutions must work hard to fill their freshmen slots each year. Many people believe colleges are rejecting most applicants, but that simply isn’t true.
The majority of admission deans spend a great deal of time worrying about attracting enough freshmen. That fear is justified if you look at how many of them fall short of their admission goals.
Every year Inside Higher Ed teams up with Gallup to survey admission officials at private and public universities and the latest survey illustrates the challenge they face. The number of admission directors at private institutions who said they met their freshmen enrollment goals was 41 percent.
Among state and private institutions, the percentage of admission officers who said they weren’t worried at all about filling their freshmen slots was 5 percent.
All of this amounts to good news for college applicants becasue most institutions are awarding merit scholarships.
How To Find Merit Scholarships
If you’re looking for merit scholarships from private institutions you need to understand how to capture them. Here are three things you should know:
Pricing is impacted by brand name
The private institutions that are most likely to award merit scholarships are the ones that have to hustle more to attract students. The institutions in this category are colleges and master’s level universities that usually don’t have the brand awareness that research universities have.
Here is a rundown of the institutions:
- The No. 1 focus of research universities is professor research and secondly the education of graduate students with undergrads representing the third priority.
- Colleges are small institutions that often focus on educating undergrads exclusively in small class settings.
- Master’s level colleges don’t have a heavy focus on PhD programs and can be a hybrid between research institutions and colleges.
Here’s an example of how it can be tougher getting a merit scholarship from a private research university:
At Northwestern University only 4.4 percent of freshmen who have no financial need receive merit scholarships. The average award is about $3,189. Most of the high-income students hoping for merit scholarships from this prestigious university will be disappointed.
When you look at the figures that Northwestern reports to the U.S. Department of Education, 54 percent of students at this elite university receive an institutional price break. Nearly everyone who didn’t pay full price received need-based financial aid. And just about everybody else paid full price.
Just like Northwestern, the most highly ranked institutions typically award few if any merit scholarships, but they often provide the most generous need-based aid. In this category include institutions such as Harvard, Yale, MIT, Stanford, Amherst, Pomona, California Institute of Technology and Duke.
Now let’s take a look at Loyola University in Chicago, a master’s-level university just four miles away from Northwestern, that doesn’t enjoy the same cache. Loyola gives 27 percent of its incoming freshmen merit scholarships and the average amount is $15,511. When you look at the federal statistics, Loyola awards 94 percent of its freshmen institutional grants and/or scholarships.
Many more colleges and universities operate like Loyola than Northwestern.
Tip: You can see what percentage of students at an institution receive institutional grants and scholarships by visiting the federal College Navigator website. Type in the name of the college in the search box and then hit the financial aid hyperlink.
Most colleges practice preferential packaging
It’s a reality that colleges and universities don’t have unlimited funds. They typically reserve their best merit scholarships for students they covet the most.
A student with a 3.8 GPA and an ACT score of 32 is usually going to receive a higher award than someone with a 3.5 GPA and a 29 on the ACT.
Muhlenberg College, a well-respected liberal arts college in Allentown, Pa., provides a candid explanation of how preferential packaging works in the higher-ed world. In its essay, The Real Deal on Financial Aid, Muhlenberg offers this valuable advice:
If money is a factor in your college search and it will impact your final choice, you should make sure to apply to colleges where you are clearly in the top third to top quarter of the applicant pool.
If you are just squeaking in for admission, odds are your financial aid, if it comes, will be mostly aid you give yourself (i.e., loans or work).
Using net price calculators to calculate merit aid
An excellent way to discover if you will qualify for a merit scholarship is to use a college’s net price calculator.
For those who aren’t familiar with net price calculators, this federally mandated tool provides a personal estimate of what a college will cost a family after the parents share their financial information and, in some cases, the academic profile of their teenager.
About 50 percent of net price calculators that colleges use, however, do not estimate merit scholarships. These institutions use a calculator that relies on a federal template that doesn’t calculate potential merit scholarships.
If a family using one of these federally inspired calculators is seeking a merit award and not need-based aid, the student is only asked these three questions:
- Do you plan to apply for financial aid?
- How old are you?
- Where do you plan to live while attending this institution?
Obviously the estimated net price that a calculator generates based on answers to those three questions can’t be relied upon.
Tip: If a college doesn’t calculate merit awards, you should check the institution’s admission website to see what awards it might offer. You can also ask an admission representative for this information.
Lynn O’Shaughnessy is a best-selling author, speaker and journalist. Her book, The College Solution: A Guide for Everyone Looking for the Right School at the Right Price, is available on Amazon.com.