That is why this announcement by Harvard caught my eye.
The initiative appears to make Harvard’s aid to students with household incomes of $120,000 to $180,000 the most generous to be offered by any of the country’s elite private universities. Harvard will generally charge such students 10 percent of their family household income per year, substantially subsidizing the annual cost of more than $45,000.
I really appreciate this initiative because it bases financial need on the annual income and doesn’t punish families who live a modest lifestyle and save their pennies. And before anyone mentions it, I do know that perfectly good college educations are available for much less than $45,000 per year. My oldest attends Texas A&M and the cost there is less than half the cost of Rice. If we didn’t have the resources to send two kids to Rice without their graduating tens of thousands of dollars in debt, I would not even consider it. I am applauding my youngest’s fascination with Texas A&M since I am not sure the nest egg will hold out for a third child to go to Rice at the rate tuition is rising. I do not believe the benefits of a big-name-school diploma warrant mortgage-sized debt. Of course the irony is that once the savings are depleted, we will probably qualify for financial aid. Hopefully, more schools will follow Harvard’s lead and try to keep the tuition as a reasonable portion of annual income and not punish families that scrimp and save. If you have been socking money away for college understand that you will definitely be using it for college. Don't think there will be any left over for your retirement. That nest egg takes you out of the running for need based aid. Under the current system if you haven’t gotten around to saving for college, don’t worry. The FAFSA based system has money for you.