UM Free Tuition for In-State Kids Whose Families Make Less Than $65K

Submitted by winterblue75 on

Just announced by UM. Leaders and Best

KBGoBlue

June 15th, 2017 at 4:04 PM ^

How many families who make about $65K a year are financially literate enough to know to shift their money into 401k/IRA/etc.? I'm going to guess "very few."

I am from a small town where many of my classmates would have qualified for this program. The top students at my high school often skipped applying to Michigan because it was known for being "expensive." Most of these students would have been first generation college students, so their parents didn't know that they could expect generous aid packages from an "expensive" school like UM. (Heck, my parents didn't know that either, and kept me from applying to OOS and private schools.) These kids ended up going to LCC/CMU/WMU to "save money," even though many of their expenses would have been covered in Ann Arbor or East Lansing.

FauxMo

June 15th, 2017 at 4:15 PM ^

Well, given that the median family has almost nothing saved for retirement - even those with just a few years from "retirement" - I am not sure financial literacy has much to do with it. You can know exactly what to do, but if you simply don't make enough to save, saving is very hard. But I agree, expecting the average taxpayer to get "crafty" to take advantage of tax/income-related benefits is asking a lot... 

rc15

June 15th, 2017 at 5:00 PM ^

Guessing here... But it might be something like in-state tuition. You can't move to Michigan right before you enroll and get it. They might make you provide your last 3 tax returns or something like that. I doubt many people will know if their kid is going to get into UM that far in advance thag they'll start playing games to get their AGI down.

Although this could screw over a family that loses a job or something...

ak47

June 15th, 2017 at 4:11 PM ^

Um offers need based financial aide to families making up to $125k.  Its not going from free to 100% at $65,001.  Yes as with any policy there are some people who don't benefit, but this seems like a clear win.

Bambi

June 16th, 2017 at 10:27 AM ^

Maybe I'm missing something because I'm at work and can't watch videos, but I can't find anything about a gradient. All I'm seeing for students above $65K is normal financial aid numbers. And those numbers are impressive, but the values listed are average values so it's not a guarantee that all students within those income brackets are going to get the amount of money listed, compared to this plan which is a guarantee.

nogit

June 15th, 2017 at 3:32 PM ^

Got to wonder how this affects kids whos parents make 70k, especially if they aren't helping to pay for college.  Presumably it is increasing everyone elses tuition by some significant amount?

ak47

June 15th, 2017 at 4:17 PM ^

In state tuition wll be going up by about $300 a year. Considering student season tickets for football cost about the same I wouldn't say its that significant of an amount. Its not like the kid whose parents make 70k and aren't supporting them is in a great situation right now and is about to get screwed.

Leatherstocking Blue

June 15th, 2017 at 4:00 PM ^

This year, the free tuition for SUNY schools is for families making under $100,000 this year, rising to $125K in two years. In upstate New York, that is a decent salary; downstate, $100K hardly covers your taxes. Seriously.

But tuition in the State University of New York system is half of Michigan's - around $6,500. Pell grants will cover most of that for the lower income families.

New York allotted $163 million for the program but has not said where it is coming from. And if you do the math for the number of students in 2 and 4 year schools in New York, it is not nearly enough to cover it for qualified students. An independent analysis estimates that NY is counting on most qulaified students to miss the deadline and not get the free tuition. 

Leatherstocking Blue

June 16th, 2017 at 11:13 AM ^

One of the caveats with New York's plan is that you must remain in New York for 4 years AFTER you graduate, otherwise your free tuition becomes a loan. Graduate and get a job in California, then your free tuition just became about a $26,000 loan. Graduate and live in New York for 2 years, then move out of state, then the last 2 years of your free tuition just became a loan.

Dylan

June 15th, 2017 at 3:39 PM ^

Awesome. But still bitter as all hell at the kids I knew with free FAFSA grants with better houses and cars than me whose parents just-so-happened to be divorced / managed to claim only one parent's wages. Dumb. Also. Amen to the people below. Better sure hope you aren't a normal, middle-class family with $120K and two kids in school -- God forbid.

Hail-Storm

June 15th, 2017 at 3:37 PM ^

I know a lot of the Michigan Endowmant is ear marked but I have been hoping that they would address the tuition issue.  This is a great start.  I hope they can eventually add a gradient as others have said. 

For others who have said how it's unfair to the families that make $70,000 I respectfully disagree.  This does not affect their current situation at all and helps people who make less.  Hopefully this program builds so that the gradient is implemented so it helps people who make $70,000 too, and so on. 

Brhino

June 15th, 2017 at 3:42 PM ^

Okay, who's got the formula?  If X is your number of children and Y is the amount of a family's income above $65k, at what point is it more cost effective to take a pay cut to get under $65k versus paying full tuition for X children?

Brhino

June 15th, 2017 at 3:47 PM ^

Well the Detroit News version of the article says in-state tutition at the Ann Arbor campus is $14,402.  So that would be about $80k for one kid or $95k for two.  Now if you're a parent of young kids trying to plan for the future and watching tuition costs climb faster than your paycheck, it really starts to get interesting.

KBGoBlue

June 15th, 2017 at 3:56 PM ^

I did the analysis. Using the terrible assumption that a family would pay full tuition for all of its children (it's either the Go Blue Guarantee or no aid), here's how it works out:

  • 1 Child: $80,000
  • 2 Children: $94,000
  • 3 Children: $108,000
  • 4 Children: $122,000
  • 5 Children: $136,000

I used a full year of in-state lower-division LSA tuition for my calculation.