5 ms·

Colleges should have more price stratification than they do. At present the price difference between MIT and Umass Amherst out of state is only 41%. Both will

by lumost 6y ago

Colleges should have more price stratification than they do. At present the price difference between MIT and Umass Amherst out of state is only 41%. Both will leave a student heavily in debt to the tune of 150-300k, the difference likely doesn't materially matter to the student as they are looking at is as a ticket to a better life.

sct202 6y ago
The top colleges have very complicated pricing schemes and are basically free to middle and lower income students, for example a student to MIT only pays if their family earns more than $90k a year which is above the median household income of $68k.
- a-posteriori 6y ago
  When I was there, less than 8% of the students were paying full tuition (of which a good chunk were international students). At a certain point, the colleges start to look like perfectly price discriminating monopolists: rather than charging the highest price to each customer, they set a maximum price ceiling and then subsidize the gap to the customer's marginal ability to pay.
  - fossuser 6y ago
    The price is so high that even if you’re not paying full price, it’s often still extremely expensive.
  - borski 6y ago
    iirc, it was even lower when I went. And this is probably the most common mistake I see made about MIT, etc.; the lack of acknowledgment that the financial aid within top schools runs deep, which simply isn’t as true for smaller or less popular schools. Going to a “top tier” school can, depending on your financial situation, actually cost you roughly what a state school would. You can argue there are too many hoops to jump through, or anything else, but that’s a different argument.
    - throwaway0a5e 6y ago
      > the lack of acknowledgment that the financial aid within top schools runs deep, I think you're confusing depth and breadth. It's like the Harbor Freight coupon. Everyone gets 20% off with a few exclusions. But the people paying less than 80% (to continue the Harbor Freight metaphor) are few and far between.
      - borski 6y ago
        No, I understand precisely what you're trying to say. Based on my (admittedly anecdotal) experience applying to colleges and working (however briefly) in Financial Aid at MIT, it was not a 20% blanket by any stretch; each case was treated individually and there was an explicit focus on ensuring students were not saddled with insane amounts of debt. There were exceptions, particularly for wealthy folks and people who were 'on the line' income-wise, but the majority got significant financial aid. Just to give you an idea, from MIT's stats[1]: * Average need-based MIT scholarship: $47,593 * Students awarded a need-based MIT scholarship: 59% * Students attending tuition-free: 31% * Class of 2019 graduates with no student loan debt: 76% * Average student loan debt for those who borrowed: $23,226 The trope that the expensive schools are the cause of the massive student loan debt problem is just that; a trope. When only 24% of the class graduates with any debt at all, I'm not convinced MIT (and similar) are the problem. This is largely due to MIT and similar schools having massive endowments from which they can draw for Financial Aid; there are cheaper schools, certainly, but they have coffers that are less deep (referring to private schools), meaning students end up having to take more debt. [1] https://web.mit.edu/facts/tuition.html https://web.mit.edu/facts/tuition.html
        grepthisab 6y ago
        You kind of buried the lede in your last paragraph: This is largely due to MIT and similar schools having massive endowments from which they can draw for Financial Aid; there are cheaper schools, certainly, but they have coffers that are less deep (referring to private schools), meaning students end up having to take more debt. It is reality that expensive schools cause the massive student loan debt problem, but expensiveness isn't totally buried in sticker price but total cost of attendance. Schools like HYSM don't saddle attendees with as much debt despite their high sticker price perhaps because of endowments.
- throwaway0a5e 6y ago
  You need to look at this from the perspective of someone who has little to no familial safety net and cannot rely on family resources to help them out when things get tough. Boston area schools being "basically free on paper" to middle income families is a reflection of the fact that a student from a ~100k income family has better options for getting ahead in the world than attending these institutions at any cost but these institutions would lose legitimacy without "economic diversity" tokens so they have to reduce the price. Going to Harvard (or similar) if you're not from the kind of people who go to Harvard is a high risk, high reward gamble with years of your life. These schools have to reduce the potential downside in order to get the quality of candidates they want to get from the demographics they want to get them from (i.e. they want to be able to pick the very best people from the "can't afford to attend" demographic). Also it's good PR. If you're the son of a plumber and your options are going to MIT for CS, or UMaine's "we match your local in-state tuition" deal paired with their crappy CS program the Maine one actually looks attractive because you're going to be surrounded by people a heck of a lot more like you (on a life experiences level), you're not gonna be bottom of your class and you won't be running the Boston rat race when it comes to housing, a part time job, commuting, and all the other "life" stuff". If you're the kind of high-achieving individual who goes to Harvard from a middle class background you're all but guaranteed to live more comfortably than your parents and retire comfortably regardless of the choice you make. Rolling a degree from a lesser state school into a stable job at BigCo isn't something you're worried about. The networking value add from Harvard or MIT isn't as much of a value add because you have no frame of reference for it and won't be making the kinds of life choices where it can be most helpful anyway (remember, no safety net, you're gonna be the one that builds it). So if you're gonna "win" no matter what you choose why add the additional risk of Harvard, MIT or some other program you could wash out of?
- andrewmcwatters 6y ago
  I always think about how absurd these pricing models are. Ah yes, if you're living lavishly at $90k per annum you, too, earn the privilege of paying for your education. I suppose at some point someone has to pay. But you're not rich at $90k. And I just don't see many of those households earning between $90-250k a year wanting to pay for such a privilege. From my perspective, you've got to be either very rich, or very poor going into those schools, because there's no reasonable room for those in-between unless you're taking out significant life-changing debt to do so. And after it's all said and done, you're overwhelmingly statistically unlikely to be making so much that the debt didn't even matter.
  - albntomat0 6y ago
    As I understand it, financial aid isn't all or nothing.
leetcrew 6y ago
> Both will leave a student heavily in debt to the tune of 150-300k unless you have a very weird financial situation, no US student is going into anything like that much debt to go to either of those two schools. it looks like you got those numbers by just taking the tuition and multiplying it by four. both schools offer substantial aid packages for eligible families. the average yearly tuition contribution for MIT is something like $17k, not far off from in-state tuition at most public universities.
- colinmhayes 6y ago
  Plenty of middle class families making low to mid 100k but not contributing to their children's tuition bill because they live in HCOL area. But yes, low income students don't pay.
  - borski 6y ago
    “Plenty,” sure. But not a majority or anything. The median family income in the US is something like 68kb
    - colinmhayes 6y ago
      What about the median income of people who attended college?
      - borski 6y ago
        "For 25- to 34-year-olds who worked full time, year round in 2018, higher educational attainment was associated with higher median earnings. This pattern was consistent from 2000 through 2018. For example, in 2018 the median earnings of those with a master’s or higher degree ($65,000) were 19 percent higher than the earnings of those with a bachelor’s degree ($54,700), and the median earnings of those with a bachelor’s degree were 57 percent higher than the earnings of high school completers ($34,900)."[1] None of those median salaries put you in the 'wealthy' category. [1] https://nces.ed.gov/programs/coe/pdf/coe_cba.pdf https://nces.ed.gov/programs/coe/pdf/coe_cba.pdf
akhilcacharya 6y ago
How much worse off is someone going to UMass by your calculation?
- jawzz 6y ago
  Not the OP, but as I’d say that subjectively speaking, you’re better off going to MIT, but only if you have the passion and drive to succeed at a place like that (which you probably do if you got into MIT). But for Boston College, Boston University, or Northeastern? You’re probably going to end up paying more than MIT and get an education that’s indistinguishable from UMass, quite possibly worse in some respects. What people have been saying in this thread is not incorrect (though should be nuanced): the ivy leagues are worth it for the caliber of the student body and reputation; otherwise, go to a (Tier 1) public school. Unless, of course, you don’t want to and can easily afford otherwise.
  - akhilcacharya 6y ago
    Maybe I should be more clear - I didn't go to a Tier1 public school, didn't get into an elite school, how screwed am I?
    - borski 6y ago
      You're fine. There are a ton of reasons MIT and UMass Amherst would help, but they are not for everybody, and I saw plenty of folks struggle at MIT and gain nothing out of it (even not graduating). What matters a lot more than the name of the institution on your degree is experience; getting that experience may be a bit tougher at a small school (you don't have FAANGs or huge biotech firms recruiting there), but it is certainly not impossible. Three of the last four engineers I hired had no formal CS degree (but they had gone to bootcamps).
  - thehappypm 6y ago
    BC, BU, and Northeastern are all excellent schools. Boston is a weird place.. any of those three schools would be a top tier private school in just about any other city in the country, but in Boston they're seen as second tier just because of the ludicrously good schools in Massachusetts. They're all in the top 50 according to US News.
pkaye 6y ago
The average student loan debt is around $33k. Median debt is around $17k. https://www.valuepenguin.com/average-student-loan-debt https://www.valuepenguin.com/average-student-loan-debt
thehappypm 6y ago
UMass Amherst is a great school, and state schools kind of see out-of-staters as cash cows. What's worse is third-tier private schools charging MORE than MIT.

by lumost 6y ago

sct202 6y ago

The top colleges have very complicated pricing schemes and are basically free to middle and lower income students, for example a student to MIT only pays if their family earns more than $90k a year which is above the median household income of $68k.

a-posteriori 6y ago
When I was there, less than 8% of the students were paying full tuition (of which a good chunk were international students). At a certain point, the colleges start to look like perfectly price discriminating monopolists: rather than charging the highest price to each customer, they set a maximum price ceiling and then subsidize the gap to the customer's marginal ability to pay.
- fossuser 6y ago
  The price is so high that even if you’re not paying full price, it’s often still extremely expensive.
- borski 6y ago
  iirc, it was even lower when I went. And this is probably the most common mistake I see made about MIT, etc.; the lack of acknowledgment that the financial aid within top schools runs deep, which simply isn’t as true for smaller or less popular schools. Going to a “top tier” school can, depending on your financial situation, actually cost you roughly what a state school would. You can argue there are too many hoops to jump through, or anything else, but that’s a different argument.
  - throwaway0a5e 6y ago
    > the lack of acknowledgment that the financial aid within top schools runs deep, I think you're confusing depth and breadth. It's like the Harbor Freight coupon. Everyone gets 20% off with a few exclusions. But the people paying less than 80% (to continue the Harbor Freight metaphor) are few and far between.
    - borski 6y ago
      No, I understand precisely what you're trying to say. Based on my (admittedly anecdotal) experience applying to colleges and working (however briefly) in Financial Aid at MIT, it was not a 20% blanket by any stretch; each case was treated individually and there was an explicit focus on ensuring students were not saddled with insane amounts of debt. There were exceptions, particularly for wealthy folks and people who were 'on the line' income-wise, but the majority got significant financial aid. Just to give you an idea, from MIT's stats[1]: * Average need-based MIT scholarship: $47,593 * Students awarded a need-based MIT scholarship: 59% * Students attending tuition-free: 31% * Class of 2019 graduates with no student loan debt: 76% * Average student loan debt for those who borrowed: $23,226 The trope that the expensive schools are the cause of the massive student loan debt problem is just that; a trope. When only 24% of the class graduates with any debt at all, I'm not convinced MIT (and similar) are the problem. This is largely due to MIT and similar schools having massive endowments from which they can draw for Financial Aid; there are cheaper schools, certainly, but they have coffers that are less deep (referring to private schools), meaning students end up having to take more debt. [1] https://web.mit.edu/facts/tuition.html https://web.mit.edu/facts/tuition.html
      - grepthisab 6y ago
        You kind of buried the lede in your last paragraph: This is largely due to MIT and similar schools having massive endowments from which they can draw for Financial Aid; there are cheaper schools, certainly, but they have coffers that are less deep (referring to private schools), meaning students end up having to take more debt. It is reality that expensive schools cause the massive student loan debt problem, but expensiveness isn't totally buried in sticker price but total cost of attendance. Schools like HYSM don't saddle attendees with as much debt despite their high sticker price perhaps because of endowments.
throwaway0a5e 6y ago
You need to look at this from the perspective of someone who has little to no familial safety net and cannot rely on family resources to help them out when things get tough. Boston area schools being "basically free on paper" to middle income families is a reflection of the fact that a student from a ~100k income family has better options for getting ahead in the world than attending these institutions at any cost but these institutions would lose legitimacy without "economic diversity" tokens so they have to reduce the price. Going to Harvard (or similar) if you're not from the kind of people who go to Harvard is a high risk, high reward gamble with years of your life. These schools have to reduce the potential downside in order to get the quality of candidates they want to get from the demographics they want to get them from (i.e. they want to be able to pick the very best people from the "can't afford to attend" demographic). Also it's good PR. If you're the son of a plumber and your options are going to MIT for CS, or UMaine's "we match your local in-state tuition" deal paired with their crappy CS program the Maine one actually looks attractive because you're going to be surrounded by people a heck of a lot more like you (on a life experiences level), you're not gonna be bottom of your class and you won't be running the Boston rat race when it comes to housing, a part time job, commuting, and all the other "life" stuff". If you're the kind of high-achieving individual who goes to Harvard from a middle class background you're all but guaranteed to live more comfortably than your parents and retire comfortably regardless of the choice you make. Rolling a degree from a lesser state school into a stable job at BigCo isn't something you're worried about. The networking value add from Harvard or MIT isn't as much of a value add because you have no frame of reference for it and won't be making the kinds of life choices where it can be most helpful anyway (remember, no safety net, you're gonna be the one that builds it). So if you're gonna "win" no matter what you choose why add the additional risk of Harvard, MIT or some other program you could wash out of?
andrewmcwatters 6y ago
I always think about how absurd these pricing models are. Ah yes, if you're living lavishly at $90k per annum you, too, earn the privilege of paying for your education. I suppose at some point someone has to pay. But you're not rich at $90k. And I just don't see many of those households earning between $90-250k a year wanting to pay for such a privilege. From my perspective, you've got to be either very rich, or very poor going into those schools, because there's no reasonable room for those in-between unless you're taking out significant life-changing debt to do so. And after it's all said and done, you're overwhelmingly statistically unlikely to be making so much that the debt didn't even matter.
- albntomat0 6y ago
  As I understand it, financial aid isn't all or nothing.

leetcrew 6y ago

> Both will leave a student heavily in debt to the tune of 150-300k unless you have a very weird financial situation, no US student is going into anything like that much debt to go to either of those two schools. it looks like you got those numbers by just taking the tuition and multiplying it by four. both schools offer substantial aid packages for eligible families. the average yearly tuition contribution for MIT is something like $17k, not far off from in-state tuition at most public universities.

colinmhayes 6y ago
Plenty of middle class families making low to mid 100k but not contributing to their children's tuition bill because they live in HCOL area. But yes, low income students don't pay.
- borski 6y ago
  “Plenty,” sure. But not a majority or anything. The median family income in the US is something like 68kb
  - colinmhayes 6y ago
    What about the median income of people who attended college?
    - borski 6y ago
      "For 25- to 34-year-olds who worked full time, year round in 2018, higher educational attainment was associated with higher median earnings. This pattern was consistent from 2000 through 2018. For example, in 2018 the median earnings of those with a master’s or higher degree ($65,000) were 19 percent higher than the earnings of those with a bachelor’s degree ($54,700), and the median earnings of those with a bachelor’s degree were 57 percent higher than the earnings of high school completers ($34,900)."[1] None of those median salaries put you in the 'wealthy' category. [1] https://nces.ed.gov/programs/coe/pdf/coe_cba.pdf https://nces.ed.gov/programs/coe/pdf/coe_cba.pdf

akhilcacharya 6y ago

How much worse off is someone going to UMass by your calculation?

jawzz 6y ago
Not the OP, but as I’d say that subjectively speaking, you’re better off going to MIT, but only if you have the passion and drive to succeed at a place like that (which you probably do if you got into MIT). But for Boston College, Boston University, or Northeastern? You’re probably going to end up paying more than MIT and get an education that’s indistinguishable from UMass, quite possibly worse in some respects. What people have been saying in this thread is not incorrect (though should be nuanced): the ivy leagues are worth it for the caliber of the student body and reputation; otherwise, go to a (Tier 1) public school. Unless, of course, you don’t want to and can easily afford otherwise.
- akhilcacharya 6y ago
  Maybe I should be more clear - I didn't go to a Tier1 public school, didn't get into an elite school, how screwed am I?
  - borski 6y ago
    You're fine. There are a ton of reasons MIT and UMass Amherst would help, but they are not for everybody, and I saw plenty of folks struggle at MIT and gain nothing out of it (even not graduating). What matters a lot more than the name of the institution on your degree is experience; getting that experience may be a bit tougher at a small school (you don't have FAANGs or huge biotech firms recruiting there), but it is certainly not impossible. Three of the last four engineers I hired had no formal CS degree (but they had gone to bootcamps).
- thehappypm 6y ago
  BC, BU, and Northeastern are all excellent schools. Boston is a weird place.. any of those three schools would be a top tier private school in just about any other city in the country, but in Boston they're seen as second tier just because of the ludicrously good schools in Massachusetts. They're all in the top 50 according to US News.

pkaye 6y ago

The average student loan debt is around $33k. Median debt is around $17k. https://www.valuepenguin.com/average-student-loan-debt https://www.valuepenguin.com/average-student-loan-debt

thehappypm 6y ago

UMass Amherst is a great school, and state schools kind of see out-of-staters as cash cows. What's worse is third-tier private schools charging MORE than MIT.