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How Do Private Schools Determine Financial Aid?

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How Do Private Schools Determine Financial Aid?
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While many parents experience extreme sticker shock when they see the price of tuition at private schools, it is important to remember that affording a private school education is not like affording a house or another purchase because financial aid is available. About 20-30% of private school students nationwide receive financial aid to defray the cost of tuition, which averages about $17,000 at day schools (and closer to $40,000 in many urban areas on the East and West Coasts) and over $45,000 at many boarding schools.

According to NAIS, or the National Association of Independent Schools, 18.7% of students at private schools nationwide are awarded some financial aid, and the average grant of need-based aid was $9,232 for day schools and $17,295 for boarding schools (in 2005). At schools with large endowments, such as top boarding schools, about 35% of students receive need-based aid. At many boarding schools, families earning under about $75,000 year may actually pay little or nothing in tuition, so be sure to ask about these programs if they apply to your family.

How Schools Determine Financial Aid

To determine how much financial aid each family should be granted, most private schools ask families to fill out applications and possibly submit tax forms. Applicants may also have to fill out the School and Student Service’s (SSS) Parents’ Financial Statement (PFS) to determine what parents can pay towards their children’s private school tuitions. About 2,100 K-12 schools use the Parents’ Financial Statement, but before parents fill it out, they should be sure the schools they are applying to accept this application. The site lists schools that accept the PFS. Parents can fill out the PFS online, and the site offers a workbook to guide applicants. Filling out the form online costs $37, while it costs $49 to fill it out on paper. A fee waiver is available.

The PFS asks parents to provide information about the family’s income, the family’s assets (homes, vehicles, bank and mutual fund accounts, etc.), the debts the family owes, how much the family pays for educational expenses for all their children, and other expenses the family may have (such as dental and medical expenses, camps, lessons and tutors, and vacations). You may be asked to upload certain documents related to your finances onto the website, and these documents are stored securely.

Based on the information you submit on the PFS, the SSS determines how much discretionary income you have and makes a recommendation about your “Estimated Family Contribution” to the schools to which you are applying. However, schools make their own decisions about the amount each family can pay for tuition, and they may adjust this estimate. For example, some schools may decide that they can not afford this amount and may ask the family to pay more, while other schools may adjust the cost of living for your city or town based on local factors. In addition, schools vary in how much aid they offer based on their endowment and the school’s commitment to providing financial aid to broaden their student body. In general, older, more established schools tend to have larger endowments and can offer provide more generous financial aid packages.

Because each school makes its own decision about financial aid and how much your family should pay toward tuition, you may wind up with very different offers from different schools. In fact, the amount of aid you are offered can be one of the factors you consider when choosing the right private school.

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