What a $300,000 College Might Cost a $200,000 Family

Still more admit everyone who needs help but may not give him or her enough grant money to be affordable. And then there are those that reject at least some qualified students because of their financial need. (In Jeff Selingo’s new book, “Who Gets In and Why,” he explains what happens at Lafayette College when it struggles through that particular situation.)

Students whose parents earn $200,000 and who get into Northwestern, Rice and Vanderbilt are theoretically among the lucky ones. Those schools are resource rich and pretty generous, though they start with list prices ranging from just over $69,000 to just over $79,000.

I ran the numbers for a theoretical $200,000 family from Ohio. I gave it $200,000 in home equity, $50,000 in a 529 college savings plan and no other children in college, and used the schools’ net price calculators. They produce nonbinding estimates, but they’re usually pretty accurate.

The schools would ask this family to pay between $39,000 and $45,000 for one year. That means students from those $200,000 families can save about $25,000 per year or more off the total retail cost of attendance.

Again, these are estimates, and the numbers might change when any such family formally applies for aid, especially for those that have their own businesses, which can offer parents various ways to alter compensation.

Many colleges treat home equity as an available asset, and they have different ways of doing so. Northwestern’s net price calculator presents a worst-case outcome for a family when it comes to home equity, said Phil Asbury, the university’s director of financial aid. Once humans review an application, the result can only become more generous.

Still, even $40,000 is a lot to fork over out of $200,000. The formulas in play generally assume that higher-income families can devote a large fraction of each extra dollar that they earn, beyond what they need to cover basic necessities, to the annual college bill.

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