A family that owns a summer home might have better access to college than a family that earns a combined six-figure income, according to a study released last weekend at the American Educational Association’s annual meeting in New Orleans.
The study, titled “The Differential Impact of Wealth vs. Income in the College-Going Process,” was written by Su Jin Jez, an assistant professor of public policy and administration at California State University Sacramento, and reveals wealth to be the most important predictor of college access.
Wealth is defined as the accumulation of a family’s income and assets, such as homes and investments.
“Wealth and income affect the college choice process differently, with wealth consistently being more significant in predicting the college-choice outcomes,” Jez writes in her study. “The impact of wealth persists even after controlling for academic achievement, habitus, social capital and cultural capital.”
The study reports that of the wealthiest 10 percent of Americans, 25 percent have obtained a bachelors degree, while only 16 percent of the top 10 percent of income earners hold a bachelors degree. Nine percent of the entire population has a bachelors degree.
The process leading up to a student’s final college decision is two-pronged, according to Tom McWhorter, executive director of financial aid at USC. First, educational preparation and culture, among other factors, define which universities applicants have access to. Secondly, financial resources often dictate what universities students apply to and ultimately attend.
“After access, which includes educational background, comes choice, which is what makes the most sense for a student, where cost is the most important factor,” McWhorter said.
USC recognizes wealth prevents many students from gaining access to the university, and has therefore developed a comprehensive method for evaluating the amount of need-based financial aid students receive.
Many universities assess a family’s income, some assets and allowance for living and retirement expenses, when allocating financial aid resources. This information is submitted as part of the Free Application for Federal Student Aid.
USC, however, also requires financial aid applicants to submit a College Scholarship Services form, which discloses assets and other expenses not accounted for in the federal calculation.
“To distribute funds for need-based grants in the fairest way possible, we will consider all income and assets that may not be considered in the federal calculation,” McWhorter said. “We may ask a family to contribute more of their resources because of their comparative financial strength, which may not come from income alone.”
USC’s methodology of distributing need-based financial aid based on the total wealth should guide other universities to make college more accesible to all Americans, according to Jez’s study.
“Policy makers looking to level the playing field and make college more accessible to all American’s must address wealth’s impact on the college-going process, instead of merely focusing on issues of income,” Jez writes.
Some schools like the University of Chicago and Yale University participate in CSS, but other schools, such as UCLA, do not.
The study goes on to report that only 2 percent of the wealthiest 10 percent of Americans have not completed high school or earned their GED, however, approximately 8 percent of the top 10 percent of income earners have not graduated from high school or earned their GED.
Of the 10 percent of young Americans with the least family wealth, 34 percent have not completed high school or earned a GED, while 26 percent of the bottom 10 percent of income earners have not graduated from high school or earned a GED.