Clarity and Confusion From Tuition Calculators

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The annual ritual of college admissions has shifted from the season of applying to the season of waiting. While that means an anxious vigil for millions of teenagers like Zachary Ewell, it goes double for their parents. Heidi and Mike Ewell must wait not only to learn where Zachary will go, but also how many thousands of dollars they will have to pay.

Zachary, a senior at Oak Park and River Forest High School near Chicago, and his parents have a new window into college pricing that millions of families before them did not. Federal rules require colleges to provide online calculators that generate a personalized estimate of the net price of attendance, based on answers to a series of questions about a family's finances.

Many families are approaching these new tools with caution, however, finding that they vary widely in thoroughness and clarity. Moreover, there is no publicly available information for gauging how accurate they are.

In addition, college administrators say that low-income families, in particular, often do not know that the net-price calculators exist. And even many financially and technically savvy upper-middle-class parents like the Ewells have made limited use of the calculators.

"We didn't have a lot of confidence that those were real numbers," said Ms. Ewell, a sales manager. "They're all so different, and it seemed like there were such wide ranges and so many caveats that it really didn't feel apples-to-apples."

Sending children to college is one of the biggest financial commitments a family makes, yet historically, parents and students had no way to predict the cost before they applied. Informed consumers have long understood that the "sticker price" -- now hovering around $60,000 at some private colleges -- was often far more than what a family would have to pay. But until a student applied, was accepted and received a firm offer of financial aid, many found it hard to get even a rough idea of the actual price.

Net-price calculators, which federal officials began to require colleges to offer in October 2011, have forced open what had been a locked door, giving families an idea of what colleges would charge them.

"It's a relatively new tool," with flaws, inconsistencies and growing pains, but "just having them is a huge step in the right direction," said Lauren Asher, president of the Institute for College Access and Success, a nonprofit research and advocacy group that recently published a report saying that too many of the calculators are hard to find on college Web sites, and hard to use.

College administrators say that their calculators draw significant traffic, but that many people start the process of entering their information but do not finish, or have trouble making sense of the calculators. Others simply do not know whether to trust the results.

"We looked at one or two, but we haven't been using them," said Eric L. Conley, whose daughter, Cydney, is also a senior at Oak Park and River Forest. "Mostly, we ask them in person about costs when we're on campus visits."

Experts caution against putting much stock in relatively small differences between different college calculators' cost projections; the colleges stress that the results are nonbinding estimates. But in broad terms, they say, if used carefully, the calculators allow rough comparisons.

They also reveal patterns that are familiar to people in higher education, but may come as a surprise to others, like the fact that the most prestigious private colleges, which usually have the largest endowments, generally offer more aid and lower net prices than well-regarded but less-wealthy private colleges, especially for families with above-average incomes; or that some colleges tilt their generosity toward the lower end of the income scale, and others toward the upper-middle range.

Most important to selective private colleges, the calculators show that for all but high-income families, a well-endowed private college can be as affordable as a top state university.

"We still face a huge barrier of low-income families and first-generation college students not realizing that they can attend a school like Brown, in many cases, for less money than their local public college," said James Tilton, director of financial aid at Brown University.

A 2008 federal law requires all colleges that participate in federal student aid programs to post net-price calculators on their Web sites. The Department of Education laid out a short list of required features and designed a template for a simple calculator, which many public colleges use. But colleges have wide latitude to take other factors into account, design their own calculators and ask far more questions.

Some colleges build their own calculators. Others use calculators from private companies, customized extensively to each college's needs. One used by about 300 colleges was created by the College Board, the company that produces the SAT and other tests, and allows a family to check on multiple colleges without entering financial information more than once.

The result is a fairly bewildering array of possibilities, with potentially troubling inconsistencies.

Just answering the most important basic question -- how much a family earns -- can be baffling. Some calculators want all wages included, others exclude money set aside for 401(k) or I.R.A. plans, and others ask for adjusted gross income. It is not always clear which figure the college wants, and the distinctions may be unfamiliar to the people filling out the forms.

Many colleges insist on a specific income figure, but some -- mostly state colleges -- ask for ranges, making the results less precise. For example, the University of Michigan's calculator produces a net price range, which can be more than $10,000 wide.

When a calculator presents a financial aid figure, it can be labeled a grant, a gift or a scholarship, depending on the college. For low- or moderate-income students, some colleges specify that the aid includes government grants, while others do not, implying that all of the aid would come from the college. Some calculators also muddy the distinction between a grant, a loan the student must repay and money a student must earn at a work-study job.

A few colleges, like New York University and the University of Miami, appear not to have updated their calculators for the 2012-13 school year. Some calculators do not work if a student's parents are divorced.

But the greatest variation is in the level of detail. That has implications for accuracy, because colleges' financial aid applications and formulas often take into account much more data than their online calculators.

"I always advise that the more questions that are asked on the net-price calculator, the more precise the answer you're going to get," said Myra Baas Smith, executive director of financial aid services at the College Board.

But college administrators say that complexity can scare people away.

"A lot of families start it and don't complete it," said Thomas E. Bear, executive director of student financial strategies at the University of Notre Dame. "We try to keep in mind how much time we're actually asking a family to spend on this."

Public colleges tend to have simple calculators. Among elite private colleges, Harvard has one of the simplest calculators, with just 16 questions on a single Web screen, while Yale has one of the most complex, requiring screen after screen of data.

Despite the drawbacks, education experts say that the calculators represent a great shift in consumers' favor, and that the challenges now are to persuade colleges to sharpen the tools, and families to use them.

Patrick M. Callan, president of a nonprofit group, the National Center for Public Policy and Higher Education, said, "Now, with these tools, at least the conversation is about how to do transparency well, rather than whether to do it at all."

The chart accompanying this article has been revised to reflect corrected figures for family contribution estimates for attending Harvard.

education

This article originally appeared in The New York Times.


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