Billions of Aid Dollars Go to High-Income Students

"The analysis, released Thursday, shows that more than half of students from the top income quartile, 56 percent, receive grants that surpass their financial need, compared to a mere 0.2 percent of students from the bottom income quartile. That means that top income quartile students were 280 times more likely to receive grants that exceeded their level of need than their lowest income peers. The share of white students that receive grants beyond their needs (19 percent)"

"Part of the issue is that the share of state grants that are merit-based jumped 17 percentage points between 1982 and now, according to the report. Over all, about 10 percent of grant aid-at least $10 billion annually in state and institutional aid-exceeds students' financial need. The analysis also found that state grants disproportionately go to students at highly selective public colleges versus students at open-admission public four-year institutions-$3,693 and $842 on average, respectively."

More than half of students in the top income quartile (56 percent) receive grants exceeding their calculated financial need, while just 0.2 percent of students in the bottom income quartile receive such grants. Top-quartile students are 280 times more likely to receive over-need grants. White students receive over-need grants at a much higher rate (19 percent) than Black or Hispanic students (5 percent). The share of state grants that are merit-based has risen markedly since 1982. Roughly 10 percent of state and institutional grant aid—at least $10 billion annually—exceeds students' financial need. State grants favor highly selective public colleges over open-admission four-year institutions, and students with an Expected Family Contribution of zero are less likely than peers with higher EFCs to receive institutional aid. The current aid allocation functions as a windfall for wealthier students while working families absorb tuition increases.

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