Reed College, Money and College Admissions

The New York Times reported yesterday that Reed College, thanks to the economic downturn, had to alter its admissions policies in an effort to enroll wealthier students. The Times article states that before Reed College sent out acceptance letters, it had to drop 100 financially needy students from the accepted-student list in favor of students who could pay their way. Similarly, when the highly-ranked college turned to its waitlist, it chose students who could pay their way. Paying for Reed without financial aid is no small accomplishment -- Reed, like most of the country's elite colleges and universities, has a total price tag of around $50,000 a year.

Reed's actions aren't as unusual as one might think. Even at $50,000 a year, nearly all colleges have operating costs that are significantly higher than tuition revenues. Much of the money for financial aid at private colleges typically comes from the endowment. When the endowment suddenly loses 40% of its value, something has to give. Most colleges have already implemented hiring and pay freezes. The remaining options aren't attractive -- cut programs, fire untenured faculty, eliminate important student support services, sell property, cancel necessary upgrades and building projects, and/or, as Reed did, try to enroll wealthier students.

Very few colleges have truly needs-blind admissions. In fact, I've heard convincing arguments that colleges would be irresponsible if their admissions were needs-blind. Ask yourself: Is it better to admit students knowing that you can't give them enough aid to pay for college, or should you be able to meet the financial needs of the students you admit? Is a college acting responsibly if it graduates students whose families had to sell the house and take out unmanageable loans to pay the bills?

Please share your thoughts below.

Related Reading:

• Reed College Profile
• 10 Top Liberal Arts Colleges
• Can You Afford College?