We've all read about how expensive college educations can be. Hopefully, you're stashing away your hard-earned bread to be able to send Timmy to Princeton. Don't worry if you can't -- endowments and scholarships are picking up the slack.
But, for those on the upwardly-mobile track and thinking of sending your kids to an elite high school, get ready for some sticker shock.
The NYTimes.com reports today about growing tuition rates and endowments at some of the nation's leading prep schools.
While schools such as Exeter charge almost $40,000 for tuition, room, and board according to the article, that's just a fraction of the average of $63,500 annually Exeter fronts to house and educate each of its 1,000 students.
So, what's an aspiring family without the requisite resources to do?
First of all, don't panic. Many Americans are in the same boat. The article cites a study reporting that in 1980, 40% of American families could afford to pay tuition at Phillips Exeter, but by 2004 that number had declined to just 6%.
Secondly and more importantly, Exeter has issued a new promise to pay the full cost for any student whose family income is less than $75,000.
The school, and others of similar caliber, are beginning to really leverage endowments, like their collegiate brethren. Exeter, for example, has seen its endowment balloon to over $1 billion, up from just over $500 million five years ago, fueled by gifts from wealthy alumni and its own successful investments.
So, while clearly our nations elite students face massively escalating costs for their college education, not to mention high school, it's good to see that endowments are being tapped after years of strong growth. The money is flowing to where it belongs: our kids.
Zack Miller is the Managing Editor of IsraelNewsletter.com, a former equity analyst for a leading multinational hedge fund, and hopes endowments will help pay for his kids' educations.
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