Tuesday, March 25, 2014

Rich school, Rich School: Financial Aid and Affording Private School

So you can stretch enough for next year's kindergarten tuition. What about 8th grade, if it's 40% more than the current tuition?

Historically, tuitions have increased 4% a year, as shown in the chart below. It's important to account for this when deciding if private school is financially survivable. A few formulas:
  • Tuition for kindergarten this fall = 1.04 x current K tuition.
  • 8th grade tuition for kindergartner staring this fall =  1.42 x current 8th grade tuition
  • Total cost of K-8 = 11 x current K tuition,
    assuming the same tuition for upper grades as lower grades.
Tuition Increases at SF Independent Schools, 2009-13

When doing financial planning, it's good to remember that your assets are included in financial aid calculations. This makes it hard to save for other priorities like a home, high school or college. If you own a home, part of the home value is protected. But if you've been saving up for a down payment on a home, be prepared to spend it on tuition. Started a 529 plan for college tuition? Be ready to use it on K-8.

How much do schools budget toward financial aid?

Most schools allocate a set percentage of their tuition revenue to financial aid. For example, Live Oak has allocated 17% of their tuition revenue for 72-73 students a year since 2009.  Looking at the percentage of tuition revenue or operating budget allocated to financial aid is one way to examine a school's commitment to economic diversity.

The percentage of students on financial aid can also be helpful, but at all the schools below, 70-80% of families earn enough to pay full freight, sometimes for 2 or more children.  Moreover, even as tuitions have risen, the percentage of students on financial aid has dropped at many schools, most notably Children's Day, San Francisco School, and San Francisco Day.



Here's the numbers for the data geeks out there.

SCHOOL Year Percentage of students on financial
aid

Estimated
average
tuition for
students
on fin aid 
Full
Tuition
Total spent on
financial aid
Financial aid as a % of tuition revenue
CATHEDRAL 2014‑15 "about 1/3" $12,100 $27,625 1.4m 19%
2013‑14 "about 1/3" $12,000 $26,700 1.327m 18%
2012‑13 "about 1/3" $12,900 $25,700 1.147m 17%
2009‑10 23% $10,900 1.017m 17%
CHILDREN'S DAY 2013‑14 31% website $8704 $25,400 "over 2m" 22%
2011‑12 36% website $8425 $23,250 1.91m 24%
2009‑10 40% website $8709 $21,190 1.67m 25%
SYNERGY 2013‑14 30%
$16,500 K‑5
$17,200 6-8


2011‑12 32% $6,400 $14,800 0.51m 18%
2010‑11

$14,100 0.57m 21%
SF SCHOOL 2013‑14 29% $9,900 $24,756 K‑5
$26,457 6‑8 
1.24m
18%
2011‑12 31% $9,500 $21,510 K‑5
$23,500 6-8
1.08m 18%
2009‑10 35% $9,800 $19,950 K‑5
$21,520 6‑8
0.9m 18%
LIVE OAK 2013‑14 27%
$24,610

2011‑12 27% $8,800 $23,550 1.07m 17%
2009‑10 website 25%
Form 990 29%
$8,300 $21,150
$22,600
0.95m 17%
SF FRIENDS 2013‑14 26% $7,500$26,000
18.5%
2011‑12 26% $7,900 $24,045 1.79m 18%
2009‑10 26% $6,600 $22,665 1.51m 18%
PRESIDIO HILL 2013‑14 22%
$23,900 K‑3
$24,950 4‑8


2011‑12 website 21%
Form 990 23%
$7,500 $22,000 K‑3
$23,295 4‑8 
0.67m 15%
2009‑10 22% $5,300 $19,985 K
$21,265 48
0.69m 17%
SF DAY 2013‑14 21% website $7,810 $27,470 1.65m 15%
2011‑12 22% $7,600 $25,770 1.70m 17%
2009‑10 25% website $7,340 $23,540 1.70m 18%
BURKE
(done)
2013‑14 20%
$26,700 K‑4
$27,750 5‑8

 11.5%
2011‑12 website 22%
Form 990 20%
$12,500 $25,000 K4
$26,000 58
1.05m 10%
2009-10 22% $11,200 $23,400 K4
$24,200 58
1.09m  11%
HAMLIN
(done)
2013‑14 19%
$28,500 website 1.58m*
2011‑12  website 21%
Form 990 22%
$11,600 $25,675
website 1.32m*
actual 1.22m

12%
2009‑10 website 22%
Form 990 19%
$10,400 $23,475 website 1.2m*
actual 1.08m 
11%
TOWN 2013‑14 19% $
$26,700 K‑5
$27,720 6-8


2012‑13 20% $10,300 $25,670 K‑5
$26,650 6-8
1.24m 12%
2009‑10 17%
1.10m 11%
ALTA VISTA 2013‑14 NL
$21,000 NL NL






2011‑12 11%
$19,000 K
$20,000 1‑2
$119k 13%
MARIN PREP 2013‑14 NL
$20,630 K
$22,070 1-5
NL NL
2012‑13 10% approx $15,600 $19,930 K
$21,320 1-5
$25k2%






* Hamlin typically spends less on financial aid than the budgeted amount listed on its website.
NL=not listed.

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