The new trick families are using to lower college tuition bills

When Molly started the college search with her oldest child last year, she was afraid her family would fall into the “donut hole” of tuition finances — where they made too much to qualify for need-based financial aid but not enough to easily pay for college out of pocket. The mother of three in Maryland knew from talking to other families as well as following discussions in Facebook groups — “Paying for College 101” and “Paying for College for High-Income Families 101” — that there were tricks for snagging discounts from colleges by comparison shopping among campuses.

Unlike retailers, colleges don’t use the term “discounts.” Rather, they attach fancy names, like “Presidential Award,” to what is generally known as merit aid because it sounds better than a price cut. Giving merit aid to students who don’t qualify for need-based aid is nothing new; the strategy has been around since the 1970s, especially for middle-class families at smaller private colleges. But in the last decade, the discounting has become much more ubiquitous among all kinds of private colleges and especially widespread for families who make more than $200,000 a year but still face financial constraints on the cost of an education. Public flagship universities have jumped on the bandwagon, too, offering similar incentives to higher-income applicants from other states (who, if enrolled, would pay out-of-state tuition prices).

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