The subject of affordability has been in the news a lot lately. It’s also been on the minds of everyone doing the work of financial aid. If you look for financial aid or tuition assistance on most independent schools’ websites, you’ll find it sitting under “Admissions” with a heading somewhere along the lines of “Tuition and Affordability.” You’re likely to see language about the school’s commitment to making their tuition “affordable” for families at a broad range of income levels, and all families are encouraged to apply. 

Clearly, the subject of affordability has become enough of a concern that discussing it openly has become an imperative for how a school markets itself. According to the NAIS Facts at a Glance for 2025-26, the median percentage of students receiving financial aid at member schools is 26.4%. When more than a quarter of your population has a specific need, addressing it openly makes sense. 

But those are only the families who are actually receiving financial aid. What about all of those who applied but didn’t qualify? Or the ones who never applied because they assumed the answer would be no?

That’s where it gets complicated.

‍

What Families Think They Can Pay

Early data from 2026-27 financial aid applications submitted through Clarity offers a revealing look at how families across the income spectrum think about what they can afford to pay for tuition. 

‍

‍

The percent values in the chart show how each median offer (at the top of each column) relates to the upper limit of that income band. A median offer of $3,000 from families earning $49,999 or less represents 6% of their income. A median offer of $20,000 from families earning between $450,000 and $499,999 represents just 4% of theirs.

Read that again: families earning significantly more are offering a smaller percent of their income than families earning significantly less.

Why would families earning significantly more feel that they can’t offer the same percentage of their income as families earning significantly less? 

‍

Affordability is Inherently Subjective

The definition of affordability is “the quality of being affordable, or believed to be within one’s financial means.” This definition, then, is inherently subjective. One of the first things you realize when you start to work in the realm of financial aid is that people have very different beliefs about what is and is not within their financial means. 

So how do we get past perception to something more grounded? That’s where data comes in.

‍

Raising Costs Are Real – But So Is Rising Income

When families talk about affordability, they’re usually talking about things getting more expensive relative to what they earn or what they have. That’s a reasonable way to think about it, and the data backs up the concern. 

The Bureau of Labor Statistics (BLS) tracks the Consumer Price Index – a measure of how prices change over time for a standard basket of consumer goods and services.

‍

‍

The numbers on the Y-axis at left are relative to the time period from 1982-1984, which is indexed at 100.

Between January 2022 and March 2026, that basket of goods became 17.45% more expensive. The data clearly show that things get more expensive over time, but that’s not a surprise. What’s insightful is the rate of change, because that tends to be what consumers react to. The steepest climb came between January and June of 2022 – a 5.4% increase in just six months, the period that gave us the highest inflation rate in 40 years. When people talk about an “affordability crisis,” this is largely what they’re pointing to.

So, if everything is getting more expensive, then affordability is getting worse, right? Well, not necessarily. 

A recent Wall Street Journal article cited a study by the American Enterprise Institute finding that roughly 31% of Americans were part of the upper middle class in 2024, up from about 10% in 1979. The study defined the upper middle class as a family of three earning between $133,000 and $400,000 in 2024 dollars. That’s roughly five to fifteen times the federal poverty threshold.  However, as the WSJ observes, “There is no single, standard definition of middle class, or upper middle class, and what counts as a hefty income in one city can feel paltry in another.”

More families are earning more, so why does affordability still feel like a crisis for so many of them?

‍

The Income Gap that Explains A Lot

U.S. Census Bureau data on income quintiles — dividing all American earners into five equal groups from lowest to highest — shows something important about where income growth has actually landed.

The chart below is a visualization of the U.S. Census Bureau data on Income Quintiles in the U.S. from 2000 to 2024 (Table A-4b)*. Each line below represents the average income of one of these quintiles (20% of the population), additionally the top line represents the average income of the top 5% of earners:

‍

The lines get flatter the lower you go. Because this chart shows inflation-adjusted dollars, a completely flat line would indicate that one’s buying power had remained the same over time, and an increase would indicate an uptick in buying power. But not all upticks are created equally:

‍

‍

In inflation-adjusted dollars, the bottom 20% of earners saw their buying power increase by 6.28% between 2000 and 2024. The top 20% saw an increase of 29.92%. In real dollar terms, that’s an average gain of $1,090 for the bottom quintile versus $72,800 for the top. That’s more than 66 times the gain, for families already earning the most. 

The top 5% gained even more: an average of $128,400 in real buying power, or over 117 times what the bottom quintile gained. 

These are averages, and not every family within each quintile is seeing identical results. But the pattern is clear: income growth has been real, and it has disproportionately benefited those who were already earning more. This helps explain why families across the entire income spectrum are raising affordability concerns. The experience of rising costs hits differently depending on where your income growth has landed, even if you are in one of the upper income quintiles.

In the next post in this series, we’ll look at the role of assets, or 'wealth', in how families think about what they can afford, and what that means for how schools interpret the financial pictures in front of them.

‍

*Data visualization produced by the author.