Financial Aid Assessments Series – Part 4: Moving to a Zero Sum Need-Based Tuition Assessment

Moving to a Zero Sum Need-Based Tuition Assessment

By: Jonathan Boulos, CEO
Edited by: Mary Stange, Client Advisor

It’s time to let demographic discounts go the way of the dodo bird. School leaders often think they are dug in too deep to make a significant, structural change to their financial aid program even if they agree that they need a change in how financial aid is administered.  The solution, while not easy, is fairly simple. Share what’s actually happening. The key is to share it early enough to give families a sense of freedom and dignity and not that they are being left without options. The overall message to families should be, “We are moving to a needs-based tuition system so that we can equitably distribute our available funds to meet an ever-growing and demonstrated financial aid need.” One of the first things that will happen when you make this announcement is that you’ll start to hear the rumor mill churn about knowing “many” families who are unhappy. Your announcement should include a commitment to have individual discussions with anyone who feels this change will have a significant impact on their ability to afford the school. Simply refuse to address imprecise claims of “many” families by responding with a compassionate invitation to a conversation with each family that is concerned so that your school leader can hear them out.

Individual conversations with families unhappy about the phasing out of discounts, combined with their financial aid application make for some fascinating discussions. Even if you do not use FACTS to track your tuition, most schools will use FACTS for their scholarship application process. When you take the time to understand the FACTS Calculated Need formula and how it is arrived at, you will learn the real reason why a family is upset about the change in financial aid structure. Sometimes it truly is that a family’s situation is exceptional and falls through the cracks of the formula. Only a one-on-one conversation reveals those exceptions. Most of the time it is that the family doesn’t truly value the education the school offers. That’s scary to confront as a school leader, but you can’t make a change for the better until you’re aware of how pervasive it is. I once had a family claim that our aid package was insufficient when I worked at a Catholic school. I went through their application, I knew I had configured the formula to include all reasonable expenses, determine what assets a family would likely use to pay for school, and how much other factors should impact that formula, so I was sure the information was correct. Through sharing that information with the mother we finally arrived at the true point when she said, “well my sons play travel baseball and it’s not a cheap sport. It’s really important to us to be able to keep that going.” Ultimately, I had to tell her, “I hope that one day you can value the education and experience we would provide as much as that travel baseball experience and I’m happy to put you in contact with someone if you have specific things that we could do to make it match up.” 

Invite families into your logic, “We continually have more in demonstrated need than we have funds available. If I offer you an additional dollar above your demonstrated need, then there is another family who will not receive that dollar of demonstrated need.” Firm and reasonable boundaries should be in place to ensure that schools are not funding lifestyle choices, and that the burden of educational decisions is left in the hands of the parents.

Recommended Action: What is your calculated need for your whole school for the last three years? How much funds did you have available (funded and unfunded) for aid in the last years? Calculate the amount of need you can meet each year. Is that percentage growing or shrinking? How many families had more need met than your percentage of total funds to total need? How many had less?