Need-blind vs. Need-aware: Be Aware

Every college is going to tell its prospective students that it is committed to helping them pay for college. Any PR guru at a higher-learning institution knows that. How many students would apply to a college that told the unvarnished truth? What if you went to college X’s financial aid website and found the following statement: “Sure, we’ll let you in. We’ll even take $10,000 off the top and call it a ‘scholarship,’ but after that, you’ll need to pay or borrow to make up the rest, which is likely to be significant.” Does any college say that?

Of course not. Every college is going to assure its students that it is on their side and will do what it takes to help them graduate. Such colleges will likely say the following

• We guarantee to meet 100% of demonstrated financial need.
• We are need-blind. We are interested in you, your talents, and your potential – not your ability to pay.
• We meet 100 percent of need as determined by the college for all admitted students.
• We do not include loans in our financial aid packages.
• Our comprehensive financial aid program offers traditional sources of financial aid, as well as scholarships.

Some phrases like “meet 100%” and “not include loans” look appealing, but others raise eyebrows. What are “traditional sources” of financial aid? According to most schools, federal loans constitute such “comprehensive programs.” Colleges take a nasty word like student debt and paint it up as something appealing, part of a “comprehensive financial aid program.” As a prospective student, it is up to you to read past the glowing language to the nuts and bolts of the school’s financial aid policy.

Most colleges/universities fit into 4 categories related to the admission process and the financial aid process.

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Did you know that only 61 of 1,130 colleges and universities in a 2012 U.S. News and World Report survey claimed to meet 100 percent of a student's demonstrated financial need? Even fewer schools meet a student's full financial need and claim a need-blind admissions process. That means that the rest of U.S. colleges and universities may not be need-blind nor provide full demonstrated need for their applicants. Let’s look at some financial scenarios depending on four sample schools.

Dartmouth College (Hanover, NH): Need-blind and Full Demonstrated Need

Dartmouth claims to be need-blind and provides full demonstrated need for all of its applicants, including international ones. With an endowment of $3.49 billion dollars, the college can definitely afford to dish out its $79 million in need-based scholarships. If it admits more full-need students than usual in one admission year, that won't put the school in the red. With an acceptance rate of less than 10%, however, applicants will be facing stiff competition for those spots.

Colby College (Waterville, ME): Need-aware and Full Demonstrated Need

Colby College, while offering to meet full demonstrated need for its students, is need-aware, not need-blind. For students on the acceptance/waitlist border, financial aid is a factor in the admission process, affecting about 3-4% of the student body. This approach makes some sense in the context of the college. Colby’s endowment dropped from $600k to $452k from 2008-2009, about a quarter of its value. While Colby has recouped that loss and exceeded its pre-Recession levels, such a drop reveals how vulnerable the school's endowment is to market activity, and this uncertainty is reflected in the school's financial aid policy. As a result, students higher up the chain will receive acceptances regardless of financial need, but borderline students might be waitlisted because their ability to pay would strain Colby’s resources.

Still, for accepted students, Colby pledges to meet full demonstrated need. Loans are not part of the financial aid packages, only campus jobs and grants.

Carnegie Mellon University (Pittsburg, PA): Need-Blind but Not Full Demonstrated Need

Carnegie Mellon is need-blind, but does not meet full demonstrated need for its students. According to the website, the school "combine[s] different types of financial support into a package" that may or may not meet a student's full financial need. After scholarships, grants, and work study opportunities are awarded, students might be awarded federal loans, and even then may need to make up the difference with private loans. So there is no disadvantage for students needing aid when applying, but if accepted, some students may need to decide on a less pricy school if the school cannot offer the financial package needed to attend.

Furman University (Greenville, SC): Need-Aware and Not Full Demonstrated Need

Furman University neither is need-blind nor does it meet full demonstrated need. Students will need to take on loans, federal or private, to make up any remaining balance after grants, scholarships, work study, and family payments have been factored in. Additionally, the university will consider a student’s financial need in the application process; if a student’s financial need is not countered by application strength, she may be waitlisted until the university can better assess its annual budget.

George Washington University* (Washington, D.C.): Need-Blind…or Not

Of course, many colleges are not as forthcoming with this information, and others are downright deceptive. George Washington University made headlines last year when it was revealed that the school claimed to be need-blind but really wait-listed students who could not pay their way. Since most institutions are pretty clandestine about their admissions policies, it is not inconceivable to imagine that other schools are claiming one thing and acting differently.

Perspective

It’s easy to paint as villains the colleges that will deny a student based on inability to pay. That practice should, at some level, grate against our notion of equal opportunity. But the converse is just as nefarious. A college does not help a student by accepting him but providing insufficient means of paying for his four-years there. It may be painful to get wait-listed because of finances, but it should be equally agonizing to be accepted to a school, yet unable to attend due to financial need. Colleges quick to admit students but failing to provide a clear means of paying for that admission are failing in their responsibility to their own.

Economics, politics, and higher-education trends point to the need-blind/need-aware issue remaining a point of contention for the foreseeable future, especially as colleges get more creative, and cruel, with their data-mining practices. What can you do about it? For juniors, as you begin amassing your list of colleges and making college visits, keep in mind the financial commitment of your colleges. Those offering to meet demonstrated need with no loans will face steep competition, but are definitely worth considering. Contrarily, those colleges that are "need-aware" or "need-sensitive" may take financial need into account when considering your application. You'll want to do your best to get your GPA, test scores, and other application criteria competitive enough to make financial-aid a non-issue when admission officers consider you for their institution. Additionally, make sure you read beyond the glossy print of the financial aid brochure to see what the college is actually offering. A "comprehensive financial aid package" may place more of the financial burden on your shoulders than should feel comfortable.

(*Correction: the original article incorrectly listed Georgetown University as the school claiming to be need-blind in its admission policy.)