money Our rankings spotlight schools with strong academics, attractive prices and generous financial aid.» by jane bennett clark n lafayette

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1 money» IN this section Profit from falling interest s 68 The latest in ID-theft scams 72 Appeal your property taxes 77 Plus Fix your money screw-ups 75 chuck zovko/lafayette college n lafayette college prides itself on its regular interaction between students and faculty. best values in private colleges Our rankings spotlight schools with strong academics, attractive prices and generous financial.» by jane bennett clark 61

2 » money // college f o r k i d s h e a d i n g o f f t o y a l e, h a r va r d o r o n e o f t h e n a t i o n s o t h e r e l i t e institutions, the news couldn t be better. Not only will they get a great education with first-class bragging rights, but they also stand a good chance of paying less than they would have p in-state at a public university. // You read that right. Institutions including the Ivies, Caltech, Williams and Swarthmore have lately announced major changes in their financial- policies. Among the changes: replacing loans with grants, offering full rides to families at higher income levels and bestowing discounts on families earning well into six figures. At Harvard and Yale, parents earning as much as $180,000 can be almost assured of getting a hefty break on the bill in the next academic year. All of which brings us to the $64,000 (or more) question: What about the 99.5% of families whose kids won t be at the peak of the academic mountain? That s no small issue as colleges and universities try to decide whether to allocate all of their money to meeting the needs of students who qualify for financial or to use some of their funds to attract good students and a diverse student body. Whereas schools with hefty endowments have the luxury and the incentive, owing to pressure from Congress to dig deep and spread wide, less wealthy * Worth Noting schools face the prospect of borrowing from Peter to pay Paul, says Don Crewell, financial- director at Caltech. Meanwhile, pity the families who pay full price for a private education. The cost of a year at a four-year private college rose almost 6% in , to an average of $32,307, and topped out at a staggering $50,000-plus. Many parents and students pay every penny, according to the College Board, including those who miss out because they are unaware of the sources and amounts of student available. That s where Kiplinger s 2008 rankings of private colleges and universities come in. Topped by Caltech among universities and Swarthmore among liberal arts colleges, our exclusive rankings showcase a range of schools with strong academics, generous financial- policies and, in some cases, a decent price to begin with. The rankings also show how your why the rankings changed Kudos to Clark University, which did not make it into our top 50 last year but ranks a respectable 33rd in 2008, thanks in part to a more competitive admissions, a better freshman retention and more financial for families both with and without need. George Washington University also made it into our rankings this year, despite a sticker price of more than $51,000. Financial for students who qualify either for need-based or merit assistance brings the cost to a much more doable $32,000. Among colleges, Colgate, in Hamilton, N.Y., and Carleton, in Northfield, Minn., each dropped out of the top 15 mostly owing to higher costs. Illinois Wesleyan jumped 13 spots to number 37 because of an improved admissions and more non-need-based. Wheaton College, in Wheaton, Ill., delivers the lowest sticker price on our colleges list, where it ranks number 12 with a total cost of $31,750. On the universities side, Elon, in Elon, N.C., brings in its total cost at $30,362, making it the lowest-priced among all 100 schools. student matches up with incoming freshmen at the schools in our top 100. And we go behind the scenes at two other schools: Princeton, a venerable institution with a groundbreaking financial- policy, and Lafayette College, in Easton, Pa., a school that aims high and takes some of its cues but not all of them from the Ivies. ll TIP OF THE TOP If your child excels in math or science and craves close contact with professors, look no further than Caltech, at the top of our university rankings for the second year in a row. This tiny research institution, on a jewel-like campus in Pasadena, offers a three-toone student-faculty ratio, the lowest among all major universities. Caltech students work side-by-side with Nobel laureates and enjoy occasional lectures by physicist Stephen Hawking, who until recently wintered in a rosecovered cottage on campus. And students, who number fewer than 1,000, learn from one another, says president Jean-Lou Chameau. Simply because of our size, Caltech gives a unique opportunity to be among people who are all extremely gifted. How gifted? Start with this year s freshman class, all of whom scored above 700 on the math SAT. Like many of its counterparts, Caltech recently announced that it will replace loans with grants, piggybacking on an already-generous financial- policy that has kept average student debt at graduation to $5,156, about one-fourth of the national average. Starting in fall 2008, students whose families earn $60,000 or less a year will receive grants and workstudy to meet their financial need. denise applewhite/office of communications, princeton 62 Kiplinger s Personal Finance 04/2008

3 n at princeton, the average scholarship now covers 95% of tuition, up from 73% several years ago. 63

4 » money // college kiplinger s best values in private Private universities Quality measures Financial measures Rank/Name Undergrad. enroll. Admission SAT (V/M)* or ACT Student/ faculty ratio Grad. 4-yr./5-yr. Total cost needbased Aid from grants non-needbased Nonneedbased Average debt at graduation 1. Cal. Institute of Technology, Pasadena, Cal % 95%/100% 3 79%/87% $43,540 $17,785 99% $14,363 20% $5, Yale, New Haven, Conn. 5, / /95 45,950 15, , , Princeton, Princeton, N.J. 4, / /96 47,375 20, , , MIT, Cambridge, Mass. 4, / /92 46,500 20, , , Rice, Houston, Tex. 3, / /89 39,955 23, , , Harvard, Cambridge, Mass. 6, / /95 48,550 17, , , Dartmouth College, Hanover, N.H. 4, / /91 46,895 19, , , Duke, Durham, N.C. 6, / /93 48,240 23, , , Emory, Atlanta, Ga. 6, / /88 45,556 18, , , University of Pennsylvania, Philadelphia, Pa. 9, / /93 47,124 23, , , University of Notre Dame, Notre Dame, Ind. 8, / /95 45,327 24, , , Brown, Providence, R.I. 6, / /93 47,132 24, , , Stanford, Stanford, Cal. 6, / /90 46,943 21, , , Vanderbilt, Nashville, Tenn. 6, / /87 47,864 20, , , Columbia, New York, N.Y. 4, / /92 47,918 25, , , Georgetown, Washington, D.C. 6, / /92 48,716 27, ,973 N/A 24, Northwestern, Evanston, Ill. 8, / /92 47,753 25, , , Brandeis, Waltham, Mass. 3, / /88 46,793 26, , , Tufts, Medford, Mass. 4, / /89 47,660 23, , , Cornell, Ithaca, N.Y. 13, / /91 46,691 25, , , Boston College, Chestnut Hill, Mass. 9, / /89 47,384 26, , , University of Richmond, Richmond, Va. 2, / /84 45,860 21, , , Johns Hopkins, Baltimore, Md. 4, / /89 48,492 29, , , Wake Forest, Winston-Salem, N.C. 4, / /88 44,680 26, , , Elon University, Elon, N.C. 4, / /76 30,362 22, , , Columbia Univ., Fu Foundation, New York, N.Y. 1, / /86 49,260 28, , , Providence College, Providence, R.I. 3, / /87 40,634 28, , , Bentley College, Waltham, Mass. 4, / /80 43,636 27, , , Trinity University, San Antonio, Tex. 2, / /73 35,037 24, , N/A 30. Whitworth College, Spokane, Wash. 2, / /74 33,898 21, , , University of Chicago, Chicago, Ill. 4, / /90 50,101 50,101 N/A 50,101 N/A N/A 32. Villanova University, Villanova, Pa. 7, / /84 45,480 29, , , Clark University, Worcester, Mass. 2, / /69 39,965 20, , , Gonzaga, Spokane, Wash. 4, / /73 35,038 22, , , Emerson College, Boston, Mass. 3, / /70 39,498 27, , , Univ. of Southern California, Los Angeles, Cal. 16, / /79 47,418 27, , , Santa Clara Univ., Santa Clara, Cal. 4, / /83 45,030 29, , , Baylor University, Waco, Tex. 11, / /69 33,564 22, , , Carnegie Mellon, Pittsburgh, Pa. 5, / /83 47,980 31, , , University of Miami, Coral Gables, Fla. 10, / /68 43,712 25, , , Marist College, Poughkeepsie, N.Y. 5, / /76 35,610 26, , , Xavier, Cincinnati, Ohio 3, / /74 35,120 24, , , Syracuse University, Syracuse, N.Y. 11, / /77 43,856 27, , , Marquette, Milwaukee, Wis. 8, /78 36,398 24, , , Case Western Reserve, Cleveland, Ohio 4, / /74 44,921 23, , , University of Scranton, Scranton, Pa. 3, / /79 37,162 25, , , George Washington Univ., Washington, D.C. 10, / /77 51,760 31, , , Boston Univ., Boston, Mass. 18, / /75 47,208 28, , ,196 N/A information not available. *Verbal/Math. Source: Peterson s Undergraduate Database. Copyright 2007 Peterson s/nelnet LLC. All rights reserved. 49. New York University, New York, N.Y. 20, / /80 48,190 33, , , Rensselaer Polytechnic Institute, Troy, N.Y. 5, / /80 48,100 27, , ,235 N/A information not available. *Verbal/Math. Source: Peterson s Undergraduate Database. Copyright 2008 Peterson s/nelnet LLC. All rights reserved. 64 Kiplinger s Personal Finance 04/2008

5 colleges Our rankings measure academic quality and affordability, with quality accounting for two-thirds of the total. We started with data on more than 1,000 private institutions provided by Peterson s, then added our own reporting. Our list ranks the top 50 universities and liberal arts colleges in sepa tables. To determine each category, we used the Carnegie classification system, which organizes institutions based on the highest level and number of degrees offered. Admission is the percentage of applicants offered admission. SAT or ACT shows the percentage of the freshman class who scored 600 or higher on the verbal and math components of the SAT, or 24 or higher on the ACT. Student/faculty ratio is the average number of students per instructor. Graduation is the percentage of freshmen who earned a bachelor s degree within four years or within five years. Total cost for academic year includes tuition, mandatory fees, room and board, and estimated expenses for books. need-based is the total cost minus the average need-based amount (excluding loans). Aid from grants is the percentage of the average package that came from grants or scholarships. non-need-based is the cost for a student with no demonstd need after subtracting the average non-need-based amount (excluding loans). Non-needbased is the percentage of all undergraduates without need who received non-need-based. Average debt at graduation is the average amount owed by a graduate who took out education loans. To break ties, we used academicquality scores and average debt at graduation. Coletta Hagan and Stacy Rapacon helped compile this data. Sort the rankings by state or cost at kiplinger.com/tools/privatecolleges. Caltech departs from other top institutions by awarding a significant number of merit scholarships. The school is considering phasing out most of those awards, says Crewell, to free up money for other uses, such as replacing loans with grants for more students and capping the contribution families are expected to make. We d like to have as much flexibility as we possibly can to be as competitive as we possibly can, says Crewell. Among liberal arts colleges, Swarthmore, near Philadelphia, also tops our rankings for the second time running. Swarthmore attracts academic stars with a bent for social justice. Students have a commitment to placing the analytical skills they ve developed and the knowledge they ve acquired at the service of a better world, says president Al Bloom. Swarthmore, too, will replace loans with grants in its financial- awards. For years we have tried to make it easier for a student to engage in the Swarthmore experience and move beyond it with as little debt as possible, says Bloom. This, in a sense, is the next step. The school will spend an additional $1.7 million out of its $1.4-billion endowment to accommodate the latest change. Although Swarthmore makes a point of allocating virtually all of its to families with need, a few endowed scholarships awarded on the basis of merit give it a razorthin advantage in our rankings over Williams College, in Williamstown, Mass. That highly competitive institution, surrounded by the Taconic, Hoosac and Berkshire mountains, defines New England excellence. It, too, will replace loans with grants for students with need in ll Setting the pace Wander the Princeton campus and witness a pleasant sight: young people enjoying privilege. Students lounge against the burnished bronze tigers flanking Nassau Hall, pray for A s in the cathedral-like chapel, eyeball the Gauguins and van Goghs at the university art museum and head for dinner at the sprawling dining clubs lining Prospect Avenue. Princeton, number three in our rankings, has led the way in conferring such privilege on students of every economic background. In 1998, it replaced loans with grants for its neediest students; in 2001, it replaced loans with grants for all students with need. We set the ball rolling, says Robin Moscato, director of financial. Our students were facing the probability of being $20,000 in debt at graduation. We felt it was important, especially for lower-income students, to provide relief. Thanks to gangbuster returns on its endowment, which now approaches $16 billion, we were in a privileged place to make that decision, says university president Shirley Tilghman. It was about creating access and opportunity. Before the 2001 policy change, the average scholarship covered 73% of tuition. This past academic year, it covered 95%. Says Tilghman, We are making it possible for extraordinary students to say yes when we say yes. For Rei Thompson of Ithaca, N.Y., the no-loan policy provided a compelling reason to choose Princeton over Cornell, Dartmouth, New York University and Wellesley. All the packages were relatively the same. The major difference with Princeton was the no-loan package. If I wanted to go to grad school or straight to work, I didn t want to have to worry about loans. Thompson, a junior, covers college costs with grants, family contributions and work-study. Princeton was also one of the first Ivies to tweak its financial- formula to benefit higher-income families. We and other institutions have been concerned that under the standard formulas, parental contributions are rising at a that is too much for families to handle, says Moscato. As a result, the school removed home equity from the financial- equation and asks its students to 65

6 » money // college best values in private colleges Liberal arts colleges Quality measures Financial measures Rank/Name Undergrad. enroll. Admission SAT (V/M)* or ACT Student/ faculty ratio Grad. 4-yr./5-yr. N/A information not available. *Verbal/Math. Source: Peterson s Undergraduate Database. Copyright 2007 Peterson s/nelnet LLC. All rights reserved. Total cost needbased Aid from grants non-needbased Nonneedbased Average debt at graduation 1. Swarthmore College, Swarthmore, Pa. 1,484 19% 90%/91% 8 86%/91% $46,780 $20,369 87% $13,868 1% $13, Williams College, Williamstown, Mass. 2, / /95 45,940 16, , , Amherst College, Amherst, Mass. 1, / /95 46,297 14, , , Wellesley College, Wellesley, Mass. 2, / /92 46,620 19, , , Pomona College, Claremont, Cal. 1, / /87 46,580 18, , , Washington & Lee Univ., Lexington, Va. 1, / /87 45,396 22, , , Bowdoin College, Brunswick, Maine 1, / /94 47,060 21, , , College of the Holy Cross, Worcester, Mass. 2, / /91 45,802 26, , , Davidson College, Davidson, N.C. 1, / /86 41,814 25, , , Claremont McKenna College, Claremont, Cal. 1, / /87 47,420 23, , , Bucknell Univ., Lewisburg., Pa. 3, / /90 44,118 24, , , Wheaton College, Wheaton, Ill. 2, / /85 31,750 18, , , Grinnell College, Grinnell, Iowa 1, / /87 43,172 23, , , Haverford College, Haverford, Pa. 1, / /85 47,644 21, , , Colby College, Waterville, Maine 1, / /89 46,800 18, , , Lafayette College, Easton, Pa. 2, / /90 45,788 25, , , Colorado College, Colorado Springs, Colo. 1, / /82 43,406 18, , , Vassar College, Poughkeepsie, N.Y. 2, / /91 47,265 24, , , Bates College, Lewiston, Maine 1, / /88 47,600 23, , , Colgate University, Hamilton, N.Y. 2, / /90 48,404 21, , , Barnard College, New York, N.Y. 2, / /87 47,848 20, , , Macalester College, St. Paul, Minn. 1, / /84 42,764 22, , , Carleton College, Northfield, Minn. 1, / /86 46,893 23, , , Furman University, Greenville, S.C. 2, / /84 40,474 20, , , Middlebury College, Middlebury, Vt. 2, / /93 46,910 22,065 N/A 46, , Wesleyan University, Middletown, Conn. 2, / /89 48,141 23, , , Hamilton College, Clinton, N.Y. 1, / /88 46,710 24, , , Whitman College, Walla Walla, Wash. 1, / /85 42,690 25, , , Bryn Mawr College, Bryn Mawr, Pa. 1, / /84 46,674 22, , , Centre College, Danville, Ky. 1, /78 36,000 18, , , Connecticut College, New London, Conn. 1, / /87 47,675 21, , , Kenyon College, Gambier, Ohio 1, / /83 46,690 22, , , Muhlenberg College, Allentown, Pa. 2, / /85 41,680 27, , , St. Olaf College, Northfield, Minn. 3, /83 39,400 23, , , Denison University, Granville, Ohio 2, / /78 42,230 21, , , Smith College, Northampton, Mass. 2, / /85 46,406 20, , , Illinois Wesleyan University, Bloomington, Ill. 2, /81 38,560 23, , , Trinity College, Hartford, Conn. 2, / /84 47,190 24, , , Dickinson College, Carlisle, Pa. 2, / /84 45,789 23, , , Scripps College, Claremont, Cal / /84 47,450 22, , , Oberlin College, Oberlin, Ohio 2, / /79 46,392 27, , , Occidental College, Los Angeles, Cal. 1, / /81 45,808 22, , , Sewanee: Univ. of the South, Sewanee, Tenn. 1, / /82 40,240 22, , , Kalamazoo College, Kalamazoo, Mich. 1, /78 36,763 20, , , Wofford College, Spartanburg, S.C. 1, / /77 36,442 19, , , Wabash College, Crawfordsville, Ind / /69 34,250 17, , , Knox College, Galesburg, Ill. 1, /74 36,378 19, , , Rhodes College, Memphis, Tenn. 1, / /80 39,024 23, , , DePauw University, Greencastle, Ind. 2, / /78 38,500 24, , , Lawrence University, Appleton, Wis. 1, /75 38,220 21, , ,626 N/A information not available. *Verbal/Math. Source: Peterson s Undergraduate Database. Copyright 2008 Peterson s/nelnet LLC. All rights reserved. 66 Kiplinger s Personal Finance 04/2008

7 contribute 5% of their savings rather than the 20% assessed by the federal formula. For the class of 2011, students with family incomes between $100,000 and $150,000 who applied for received annual awards averaging $22,700 to $27,700. Curious to know what your own package and expected contribution might be? Princeton provides an online calculator that poses 20 or so questions and then spits out a rough estimate. We made it as simple as possible, says Moscato. If you don t qualify for or want to exchange your student s work-study for a loan, investigate Princeton s parent lending program, which recently offered a no-fee loan at a fixed of 5.7%. ll Moving on up Perched on a hill so high you can practically see Princeton 55 miles to the east, Lafayette College (number 16 in our rankings) has yet to pierce the rarefied air of the Ivies. Still, its strengths include five engineering degrees, including a bachelor of arts. Our students understand not only the technical aspects of a problem but the human aspects as well, says Wendy Hill, the provost. Lafayette students travel to Honduras to work with Engineers Without Borders, where they help create water-distribution systems and nurture coffee production. Lafayette s small size some 2,400 students and intimate atmosphere create its own fertile ground for learning, says senior Debra Perrone, who knows her professors and their kids. I have friends at big schools who have to put their IDs on the table so their teachers know who they are, says Perrone. President Daniel Weiss plans to build on Lafayette s assets, and boost its academic standing, by adding 35 faculty members. Strong interaction between students and faculty is why people come to places like Lafayette, says Weiss. With an endowment of $734 million, Lafayette ranks 98th among the nation s 100 wealthiest colleges and * KipTip The best ways to borrow If your student s financial- package is made up entirely of grants and workstudy, with no loans, consider yourself blessed. If you have to borrow, start with the programs below. All but the institutional loans are backed by the federal government. PERKINS. Available only to students with exceptional need, Perkins loans carry a fixed 5% interest. Repayment begins nine months after graduation; until then, the federal government picks up the interest. If your student qualifies, the financial award will say so. SUBSIDIZED STAFFORDS. Like Perkins loans, subsidized Staffords are need-based. Loans disbursed for the academic year carry a fixed 6% interest. The feds pay the interest until repayment begins, six months after your student leaves school. Borrowers can choose among several repayment options. UNSUBSIDIZED STAFFORDS. Any student who applies for federal financial can get these loans, but interest starts accruing as soon as the loan is disbursed. The is fixed at 6.8%. As with subsidized Staffords, borrowers can defer repayment until six months after leaving school and choose among several repayment plans. PARENT PLUS. You have to pass a basic credit check to get one of these loans, which carry a fixed interest of 8.5%. Repayment begins within 60 days of disbursement, but some lenders let you defer repayment until after your student graduates. INSTITUTIONAL LOANS. Offered or sponsored by the school itself, they can be a great deal or not. Examine the terms before you sign up. universities, according to the National Association of College and University Business Officers. Those deep pockets allow it to guarantee that at least 75% of students need is met with grants and to keep the average debt at graduation to a relatively reasonable $18,000. Lafayette also bestows merit scholarships, ranging from $8,000 to $43,010, on 14% of its student body. Like many schools that are trying to move up the academic slope, Lafayette feels pressure from the Ivies and near- Ivies to offer more and better financial. Harvard and others have upped the ante, says Arlina DeNardo, Lafayette s financial- director. Those schools are not a direct overlap, but the move from loans to grants clearly ripples through the rest of higher ed. People look at what they re doing and say to us, What about this? Accordingly, Lafayette hopes eventually to reduce the average debt at graduation to about $10,000. But it doesn t intend to eliminate loans altogether. We don t have the resources, and I m not sure we would proceed in that way even if we did, says Weiss. Students benefit from having a stake in the process, says DeNardo. It s a joint effort. If they could graduate with half the national student-debt level, at $10,000, that s pretty good. Lafayette tracks its neighbor to the east by giving parents access to a loan program with attractive terms that compare favorably with the federal Parent PLUS program. These loans carry an interest pegged to the prime plus two percentage points. The college picks up the interest while a student is enrolled; repayment begins once the student graduates. What all of these efforts demonst is that even colleges that don t have the same resources or endowments as the Ivies still do a good job of helping families put together the pieces to pay for college, says Moscato. One of the great things about higher education in this country is that there is a huge range of options. n 67