Grandparents Getting the Call As City School Tuitions Go Up
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With New York private school tuition approaching the $30,000 mark, a growing number of grandparents are helping to foot the bill. Eyeing the trend, savvy school fund-raisers are courting grandparents for gifts above and beyond the sticker price.
“We have seen an upswing in the incidence of grandparents paying tuition, and also of schools reaching out to grandparents to get them involved – both volunteering in the classroom and contributing to the school’s bottom line,” a spokeswoman for the National Association of Independent Schools, Myra McGovern, said.
Pitching in with tuition is a choice, not a responsibility, Ann Lubin Buttenwieser, who has 13 grandchildren, said. Several of Mrs. Buttenwieser’s grandchildren are enrolled at schools such as St. Bernard’s, Spence, Dalton, and the 92nd Street Y, and she and her husband make annual gifts of varying sizes to the schools.
Mrs. Buttenwieser said many institutions host grandparents’ and special friends’ days, during which they are invited to take part in classroom lessons and activities; the schools collect the names and contact information of attendees. “Once they have names and addresses, I think development officers can figure out who they are, if they do some homework,” she said.
Other grandparents contacted by The New York Sun acknowledged helping out with tuition, but, seeking to protect their children’s privacy, declined to speak about it on the record.
Ms. McGovern said “dramatic” cost-of-living increases in recent years have left many families hard-pressed to absorb tuition hikes. The median cost of a private secondary education is $27,200 in New York – about $10,000 more than the national median, according to NAIS data. The association includes about 1,200 private day and boarding schools worldwide.
On average, Ms. McGovern said, tuition covers about four-fifths of schools’ operating costs, and most depend on supplementary donations to make ends meet. Ms. McGovern said attitudes about soliciting from grandparents have evolved in the past decade. “It used to be, ‘Don’t go there,'” she said. “There’s been a generational shift, and more grandparents are willing to go there.”
The School and Student Service for Financial Aid – an NAIS service that helps private schools determine how much financial aid applicants are able to pay toward tuition – does not request grandparent contact information on its Parent Financial Statement form, but asks applicants to list “cash support, gifts, or money paid on your behalf (from relatives or non relatives).”
Robyn Gaines, who works in the development office at the Columbia Grammar and Preparatory School on the Upper West Side, said her office sends home requests for grandparent contact information. “They either give it or they don’t. If they’re uncomfortable, they don’t,” she said, noting that, in addition to solicitation letters, grandparents also receive school journals and annual reports.
Many grandparents helping out with tuition prefer to give the money directly to their children as a gift, rather than write the check to the school, the president of Educational Investments LLC, Harold Simansky, said. Based in Boston, the firm helps families plan for school expenses.
Mr. Simansky said that under federal law, gifts to an individual of more than $12,000 a year must be reported to the IRS. A gift tax of 46% goes into effect if a person gives away more than $2 million during his or her lifetime. Tuition paid directly to an educational institution is not considered a gift and is not taxed, according to a recent IRS ruling.
“Certainly, in the last five years or so, as we’ve seen tuition rise above the gift tax exclusion. Grandparents have come out of the closet because they cannot funnel it through their grandchildren’s parents,” Mr. Simansky said. Tuition payments are also a way for grandparents to reduce the value of their estate and avoid estate taxes, he said.
Irwin Schlachter, the headmaster at Rodeph Sholom Day School, a private Jewish school on the Upper West Side, estimated that up to 15% of the school’s tuition checks come directly from grandparents.
With the price of Jewish day schools soaring as quickly as their prep school counterparts, the Orthodox Union has unveiled a “tuition initiative” that calls on well-off grandparents, Jewish federations, and private foundations to help. Some Jewish day schools have even started asking for grandparent contact information on admissions applications or financial aid forms.
“I know it’s becoming a tradition now in a number of Jewish communities because tuition is only affordable when grandparents can help pay,” said Rabbi Daniel Schonbuch, director of the union’s Young Leadership Cabinet, the group that helped draft the initiative.
At a recent Partnership for Excellence in Jewish Education conference one session was called “Grandparents: An Essential Element of Day School Philanthropy and Life,” and panelists shared strategies about cultivating grandparents as donors.
The headmaster of Loyola School, a Catholic school on the Upper East Side, said he has seen a marked increase in grandparent participation in school life. “We do have grandparents involved – helping out, paying tuition, coming to sports games, coming to plays,” James Lyness said. “I do see grandparents more actively engaged than they have been in the past.”
Tuition at the city’s Catholic schools varies widely. Schools operating under the auspices of the archdioceses can cost anywhere from $3,000 to $10,000 annually, while order-sponsored schools are generally more expensive, Mr. Lyness said. Loyola, affiliated with the Jesuits, costs about $21,000 a year.
Loyola’s vice president of finance, Susan Conniff, said she is aware of several grandparents who are paying tuition. “It’s advantageous from a tax point of view,” Ms. Conniff said. “I expect that I may see more of it in the future.”
Grandparents’ role in paying private school tuition is a common theme of postings on online parenting sites. On an urbanbaby.com message board, one parent wrote: “Just had lunch with my mother. She gave me a check for … preschool tuition. Not sure how I feel about that.”
Another was more certain: “If I had money” and my child needed it “I would give it. I expect the same from my parents.”