Halloween Special

What's scarier than the cost of going to college? How about the idea that the school is never going to stop asking you for donations.

I mean, never. It won't always be a straight-up ask for money. It will often come couched in "alumni news" or "college updates," but there's always an "opportunity" to donate. And it never ends.

Why do they do this? Why does an institution that charges you thousands of dollars, sums so big you'll likely take out loans to pay for it, then ask you for more money once you've graduated (or even before you've graduated)?

The first part of it has to do with the school and its budget. Believe it or not, the tuition and fees you pay for college don't cover the entire cost. In fact, according to this National Center for Education Statistics report, tuition & fees only account for an average of 20.3% of revenue for four-year public colleges. At private colleges, which tend to be more expensive because they don't receive as much government funding, tuition & fees account for an average of 29.5% of their revenue. So even at really expensive private universities, the money that you pay doesn't even cover half of what they spend per student.

At private institutions, private gifts and grants make up 10.5% of their revenue on average, and returns on investments make up 25%. For most of those investments--called the university's endowment--the money that goes in to the investment fund is mostly from private gifts and grants. So in one form or another donations, mostly from alumni, make up as much of the school revenue as tuition & fees. So getting donations is very important to the school's budget. The money they get from donations isn't just extra--it's necessary to keep the school running and growing.

So universities need a few really big donors to give millions of dollars to fund big projects like new buildings or expanding programs. If you find yourself wealthy enough some day to give that kind of money, good for you! But it probably won't happen. They also need a good-sized batch of people who give in the thousands, and they need as many people as possible to give a little bit every year. They can't make you donate once you leave, but they're going to keep trying. And trying. 

The second part of it has to do with you. If you treat your college search like a relationship and look for a good match, then you don't just go to a place, you join a community. And just as many people don't stop interacting with their family once they grow up and move out on their own, many people don't stop being a part of their college community once they graduate. For a lot of Americans, the college you attend is part of your identity, and part of that is supporting your college--and therefore your identity--after you're gone. If you can not only imagine yourself going to classes at a school, but also wearing a t-shirt from them and writing an annual check once you've graduated, then you've probably found a good place.

You may or may not choose to give to your university once you graduate, and schools may or may not choose to keep building their prices based on the assumption that they'll get money from you after you graduate, but solicitations from your alma mater don't have to be scary. It's, eerily, one way they can keep the costs down a little bit.

 

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