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The average student at Harvard doesn't pay even close to actual tuition, most of the endowment is earmarked for student aid. If I remember right, something lik

The average student at Harvard doesn't pay even close to actual tuition, most of the endowment is earmarked for student aid. If I remember right, something like under 90k earned by the student's family, they pay nothing. I haven't worked there in 2 years, so the math is a bit fuzzy but the concepts are accurate.

huac 6y ago
while most students do pay much less than sticker price, saying 'most of the endowment is earmarked for student aid' feels misleading. in fy2019 harvard spent $193M on student aid (https://finance.harvard.edu/files/fad/files/fy19_harvard_financial_report.pdf https://finance.harvard.edu/files/fad/files/fy19_harvard_fin...) -- compared to a $5.2B operating expense spend and a $41B endowment size.
- brain5ide 6y ago
  A conservative 3% of endowment would be the expendable return. So about 1.2B? Wouldn't be surprised if 193M is the largest distinct chunk of that.
  - huac 6y ago
    they have other operating income, e.g. tuition from everyone else, and are consistently doing capital raises. the single largest chunk of spending goes to employee wages (approx $2B); in fact, the $193M number is the smallest of all the line items in operating expenses. as another comment points out, some of the salary and wage spend could be considered part of 'financial aid.'
- tylerhou 6y ago
  Endowment paying operating expenses is essentially financial aid, because it's a cost that is not passed on to the students.
- vonmoltke 6y ago
  > in fy2019 harvard spent $193M on student aid That is only undergraduate aid applied directly to tuition. Per Note 12 on page 43, "Total scholarships and other student awards" was $613,243k, of which $457,639K was in direct credits to expenses. That said, I don't know where the GP got the idea that most of the endowment is earmarked for financial aid. Per page 11, that earmark is specifically 19%.
finolex1 6y ago
Yes, but for the 50% of students that are not on financial aid, this must be pretty galling. These students may be rich, but a lot of them are not multimillionaire-rich. Even a family earning 200k a year will feel the pinch.

huac 6y ago

while most students do pay much less than sticker price, saying 'most of the endowment is earmarked for student aid' feels misleading. in fy2019 harvard spent $193M on student aid (https://finance.harvard.edu/files/fad/files/fy19_harvard_financial_report.pdf https://finance.harvard.edu/files/fad/files/fy19_harvard_fin...) -- compared to a $5.2B operating expense spend and a $41B endowment size.

brain5ide 6y ago
A conservative 3% of endowment would be the expendable return. So about 1.2B? Wouldn't be surprised if 193M is the largest distinct chunk of that.
- huac 6y ago
  they have other operating income, e.g. tuition from everyone else, and are consistently doing capital raises. the single largest chunk of spending goes to employee wages (approx $2B); in fact, the $193M number is the smallest of all the line items in operating expenses. as another comment points out, some of the salary and wage spend could be considered part of 'financial aid.'
tylerhou 6y ago
Endowment paying operating expenses is essentially financial aid, because it's a cost that is not passed on to the students.
vonmoltke 6y ago
> in fy2019 harvard spent $193M on student aid That is only undergraduate aid applied directly to tuition. Per Note 12 on page 43, "Total scholarships and other student awards" was $613,243k, of which $457,639K was in direct credits to expenses. That said, I don't know where the GP got the idea that most of the endowment is earmarked for financial aid. Per page 11, that earmark is specifically 19%.

finolex1 6y ago

Yes, but for the 50% of students that are not on financial aid, this must be pretty galling. These students may be rich, but a lot of them are not multimillionaire-rich. Even a family earning 200k a year will feel the pinch.