So the better question is why they don't raise prices such that the rich kids have to pay the true full price & have more money for aid for the less-rich.

Or, to take it further, it's quite likely a Veblen good: because only families that can shrug at $30,000 a year for private school will be going there, your kid will only associate with other rich kids, creating valuable romantic and professional networks.

My point is simply that there are other circumstances and picking an absolute number seems to be biased toward younger people with no obligations.

More importantly, when private universities do post their tuition, they don't post them as "max tuition pending review of financial status", but increasingly they are as no reasonable person will pay something closing in on a quarter million dollars for an undergraduate degree (I'm thinking tuition, books, supplies, food, housing, the whole shebang) that some schools these days are commanding. And I think it's because the universities spend quite a bit of effort trying to figure out how to shift the tuition to a deferment rather than a waiver or reduction. So we get a "tuition" link right next to the "financial aid" link and a wink and nod from the school because surely everybody knows those rates are negotiable.

I think I return to my main point which is that a decent undergrad education in the U.S. doesn't really have to cost $100k-$250k no matter the school one attends. However, the ridiculous rates private schools post doesn't help things. Their actual average tuition rate is likely much much lower - and the full price is a "penalty rate" for coming from money.

What's troubling is how a relatively simple breakdown like I provided earlier up this thread or yours seems to be a great mystery.

If you are a public funded institution, you charge the same for admission to all students.

The moment the university stop taking public funds, you can have your wealthy students subsidize the less well off classmates.

The problem with his central thesis though, I find is the reason behind jacking the price up. The reason isn't to make the school more prestigious, but rather to be able to soak all buyers at the proper price point. You can't state a lower tuition and then jack it up for the children of lawyers and hedge fund managers. You need to start high and then offer assistance to the children of mechanics and plumbers. (I know -- many plumbers are rich)

The funny bit is while airlines and car dealers have to resort to judgment and tricks to figure out your price point, colleges get the FAFSA handed to them.

I suppose at some point someone has to pay. But you're not rich at $90k. And I just don't see many of those households earning between $90-250k a year wanting to pay for such a privilege.

From my perspective, you've got to be either very rich, or very poor going into those schools, because there's no reasonable room for those in-between unless you're taking out significant life-changing debt to do so.

And after it's all said and done, you're overwhelmingly statistically unlikely to be making so much that the debt didn't even matter.

The most prestigious colleges actually don't charge much money, except for families that can easily pay. Financial aid, including stipends for living expenses, is extremely generous at elite schools. The sticker price might be high, but few people actually pay it.

The problem is more with second tier schools that aspire to greater prestige but have more limited financial resources. While many of these schools offer perfectly good educations, they don't really open the same kind of doors that going to a more elite school can. A big tuition price can make parents think they're sending their kid to a really elite school - just like people often will assume a more expensive diamond ring is better than a less expensive one. But it's probably not really worth the money.

And in terms of medical costs, for most people, private insurance covers a vast majority of medical expenses.

I just assume that I will pay for my kids' undergrad. It's the norm where I live.

Absolutely not. Financial aid is dependent on parents' income and wealth, regardless of parents' willingness to actually bankroll said school. The cost is significant, rivaling the average annual gross household income, but worse because you pay high interest rates on top. Don't kid yourself, worrying about the cost dissuades lots of people.

My daughter is going to school in the fall, and I ran into this pricing strategy immediately. Her choice of college started tuition at over $50k/year, but offers "scholarships." These aren't Pell Grant etc, but scholarships that apply only to this institution. You get a scholarship for touring the campus. You get another scholarship for being a state resident. Eventually, you're effective tuition rate is cut in half.

This strategy is brilliant because it works on 3 axis; first, the parents feel like they're getting a good deal (since the effect of anchoring the tuition at $50k is hard to resist). Second, the school can appear elite since it charges a high tuition. Third, the student (and parents) feel good because their kid "earned" scholarships.