The Rapid Depreciation Of A Harvard Education: How Private School Grads Can Still Save Themselves

If you're thinking about applying to Harvard or the likes, reconsider. There's a rapid depreciation of a Harvard education and other elite private universities that is going on right now. The people are revolting against the rich and connected, especially when so many people are suffering during the pandemic.

When I was applying to colleges in 1994, I thought only extremely smart or talented people attended Harvard. I had heard stories about the rich buying their kids' ways into Harvard, but I was unaware of the details until the bribery scandal.

As a public school kid with an OK SAT score, a 3.6 GPA, and unspectacular extracurricular activities (tennis team captain vs. eradicating malaria in a small village in West Africa), I decided to save myself hundreds of dollars in application fees and apply to mostly local state schools like UVA, Mary Washington, and William & Mary instead. Paying less than $3,000 a year in in-state tuition even back then felt like a steal.

Life After Public School

After graduating from William & Mary, I got a job in the international equities department at Goldman Sachs in NYC. That's where I got to interview hundreds of Ivy League and other elite private institution graduates as part of Goldman's consensus-driven interview process where even grunts get to interview candidates.

We ended up rejecting over 95% of the candidates due to poor fit. It wasn't that they were not smart, because they were. We only wanted people we could sit next to for 12-14 hours a day. It obviously helped if they had an international background, spoke multiple languages, and had a passion for equities. But we were mostly looking for great teammates.

Rejecting the majority of elite private college graduates made me realize they are no different from you and me. For the next 13 years, I'd compete with these folks on the ruthless battlegrounds of finance and smash them to bits most of the time because of my hunger. 

Coming from a non-target public school background with middle-class parents, I wasn't going to squander my opportunity for financial independence.

Today, I am a small business owner with business owning friends. Recently, some of us have noted a growing negativity towards alumni of elite private schools. This is a problem (or a solution) for parents who plan to spend lots of money starting in grade school in the hopes their kid will attend a school like Harvard. This is also a potential problem for private university alumni who might unfairly be judged by the masses.

If you are one of these alumni, don't be upset about the trend against the 1%. Instead, read with an open mind and pay attention as your future or your kids' future might depend on it.

This article will address:

1) Why there is a growing negative perception about private university graduates

2) What we've learned from the Harvard / Asian-American discrimination lawsuit

3) What you can do to fight back against the negative perception

The Harvard / Asian-American Discrimination Lawsuit

One of the reasons Harvard University fought so hard to keep its admissions process a secret was because it didn't want the world to judge it for how it picked winners and losers. Due to social media and the internet, they knew that the jury of public opinion would come down on them like a guillotine.

Here are some interesting things we've learned so far from the Asian-American discrimination lawsuit against Harvard:

~5.9% overall acceptance rate (all students)

~33.6% acceptance rate for legacy (67% of students are not legacy)

~40% acceptance rate for children of donors

~70%+ if both legacy and donor

~86% if recruited athlete

Rich And Connected

Think about these statistics for a bit. If you are simply born into a family where one of your parents or grandparents went to Harvard, you have a 5X greater chance of getting a Harvard education than someone who has no legacy status.

One can argue legacy admissions help create a stronger university culture, and that there should be some preference. Maybe a 1X boost to 11.8% would be fair. But a 5X preference seems excessive, even if the children of alumni have more resources like $3,000 SAT tutoring afforded to them.

Meanwhile, if you donate money to Harvard, which already has the world's largest university endowment at over $35 billion, your child's acceptance rate chances go up by 7X the average admissions rate. How is that considered bribing your kid's way to get a Harvard education?

How Much To Buy Your Way Into Harvard

Based on intimate conversations I've had with a Harvard undergraduate and business school alum who also was on their fundraising committee for a couple years, between 2000 – 2010, you could donate between $250,000 – $500,000 and effectively help give your child a 7X advantage. Today, he says the donation figure is “in the millions.”

Now imagine you are a legacy candidate whose parents are also rich enough to donate millions of dollars to Harvard. You've got a 12X greater chance of getting into Harvard than some smart kid with great extracurricular activities whose parents are not as rich or connected enough to help. You are practically a shoe-in.

This is not a meritocracy by any means. This is affirmative action for the rich and connected – the very people who need the least amount of help. 

Getting a Harvard education is clearly rigged.

Getting Harder To Get In

Another interesting thing we've learned from the Harvard / Asian-American lawsuit is that the overall acceptance rate at Harvard and other Ivy League institutions was much higher in the past.

For example, Harvard admitted 92.4% of applicants for the class of 1941 (1,092/1,182) while 14.6% were admitted for the class of 1992. (~2,107/14,430 with 1,605 enrollees.) Related: The Chosen

In other words, it should be more impressive if you are a younger Harvard alumnus than if you are an older Harvard alumnus.

With the number of international students applying to US universities growing, it's only natural to expect the acceptance rate to continue shrinking despite the reality that education via the internet is now free.

In other words, the overall madness of paying enormous sums of money for a depreciating pedigree continues unabated. However, I believe this situation will eventually change, at least here in America. A Harvard education is overvalued.

Harvard Acceptance Rate History

But What About The Brightest Students?

We should all accept that Harvard and other private institutions have the right to craft their classes however they see fit. After all, as private citizens, we have the right to apply to wherever we want.

However, Harvard and other private institutions should at least acknowledge they use race, legacy, money, and athletics as determinant factors in their subjective crafting of an incoming class. To tell the world they they do not discriminate against Asian-Americans is an insult to our intelligence. They should own their decisions to discriminate with pride!

Harvard Admissions Rate By Category - Depreciation of a private school education
Source: Harvard, WSJ

But the real fallout may rain on those private university graduates who actually have no legacy connections and no donor parents. The majority who simply got in due to merit.

Further, what about the legacy and/or donor graduates who may have been able to get into Harvard without receiving massive, non-merit based advantages? They may be unfairly sullied as well.

Finally, what about the private school graduates who are simply just wonderful people who pay their taxes, give back to society, fight for equal rights, work at helpful jobs, and are just doing their best everyday to provide for their families?

Given they mostly end up doing the same work as you an me, it doesn't seem right for them to get railroaded by the public.

A Decline In Private School Reputation

As the reputations of such private universities decline with the wider understanding of how the system works, there is one clear solution to help the most deserving private university graduates:

Clearly state on your resume or job application: not a legacy or a donor graduate.

By clearly stating you got no help from what society hates most about the aristocracy, you distinguish yourself and enhance your accomplishment. A Harvard education is becoming toxic in some circles.

You may feel that highlighting you are not a legacy and not a donor might come across as too forward. It will, especially if the hiring manager comes from a private university whose parents did donate and go to such a university.

SAT score for admitted students by race at Harvard

Hiding Your Pedigree As A Strategy

This is why you must do background checks on your interviewers before making your case. Faced with a legacy or donor interviewer, consider not highlighting your merit.

It is also possible the privileged hiring manager wants to help you out because s/he feels guilt for gaining such an unfair advantage. There are people who continuously struggle with their privilege, unable to discern whether it was their talent or their parents that helped them get to where they are.

Given words matter, perhaps this is an even better way to highlight your merit on your resume: first generation XYZ university alumnus. By definition, if you were the first, you are not a legacy. Although this doesn't solve any suspicions of you getting ahead through massive financial gifts by your parents.

Given only ~40% of Americans have a 2-year college degree or more, less than 1% of all Americans will have attended elite private school universities.

In other words, a supermajority is on your side so do not be afraid to stand up for meritocracy! 

More and more public universities will rank higher than private universities. The reason is because the ranking methodologies are changing. Rankers of universities are considering diversity and inclusion much more, especially since universities give so much lip service to diversity and inclusion.

The Gatekeepers Agree

As a small business owner, I want to hire the most collaborative, smartest, efficient, and hungriest person available. I do not care where you went to college. There is no room for nepotism in small business because the financial buffers are too thin not to hire the best.

All I care about is your attitude and willingness to learn and get things done. Are you going to be a prima-donna pain in my side? Or are you going to stay hungry and keep on hustling?

If I can find an Ivy League graduate with such attributes who got in 100% due to merit, I'm going to hire that type of person all day long, all else being equal. But if I can't, then I will have to be more thorough in my interview and search process.

I've spoken with a couple friends who both employ over a hundred people, and one friend who employs over 3,000 people about the Harvard lawsuit.

They all actively welcome graduates of elite private universities to somehow signal they are not legacy or donors. Two went to public university, while one went to an elite private university, but didn't rely on money or connections.

Change Is On Its Way

Old money industries, like banking, private equity, venture capital, money management, and management consulting, are filled with elite private school alumni who will continue to have their biases, so tread carefully. Don't lose your mind trying to get a Harvard education or highlight you have a Harvard education.

But new money industries like tech and biotech are extremely focused on meritocracy. Over time, I'm confident old money industries will slowly remove their biases as well, starting by casting a wider recruiting net beyond specific private universities.

One of the end goals of going to college is to get as good a job as possible. If the gatekeepers are changing the way they hire, you best believe universities will change the way they accept students.

Related: Industries That Can Pay More Than $1 Million A Year

The Long-Term Trend Is Away From The Elites

The people are angry at the elites

In order live an easier life, you must recognize trends and adapt. Despite the massive accumulation of wealth by the rich in the latest bull market, the long-term trend is turning sour against the wealthiest people in our country who've received the most benefits.

The internet democratizes knowledge and access. Therefore, over the long-term, college degrees will be devalued. Elite private university degrees will be no exception.

Nobody wants to help the rich and powerful get more rich and powerful anymore because nobody roots for the armored gladiator with a sword versus a naked gladiator fighting with only his bare hands. Further, more people will be empowered to create their own fortunes through entrepreneurship or freelancing.

Some of the rich and powerful are clinging on to elite education as the last bastion of the aristocracy while the commoners are using battering rams to break down the gates.

Recommendation For Harvard And Other Elite Private School Alumni

If you will be or are an alumnus of Harvard or other similar institution, I encourage you to do the following:

1) Don't voluntarily tell anybody where you went to college. If people ask, talk about the state or city where you went to school and then quickly change the topic.

2) Stay humble. Instead of talking about your wins, discuss your struggles. People already assume you have everything. A Harvard education is becoming a negative signal in society.

3) Build your giving resume (time and money). Eventually, people will find out about you. And if they realize you've received all this help while you've done little-to-nothing to give back, you will be skewered. Besides, helping other people is the greatest gift on earth.

4) Stop working at companies that create useless products or take excessive advantage of minimum wage laborers. Don't let your education and family wealth go to waste. If you're oblivious, you'll know once you see your company being questioned on the news about their labor practices.

5) Let your kids earn their way through life. One of the worst things you can do is take away your kid's sense of pride and accomplishment by giving them everything. Let your kids deserve what they've earned.

In Search For True Meritocracy

Harvard admissions by race
Source: Harvard. Compare the top decile percentages to the actual share of admitted class

Nobody should blame parents for giving their kids every advantage possible to get ahead. Meanwhile, no kid should be blamed for receiving every advantage possible either. They have no control over their parents.

There are plenty of fantastic people who graduate from elite private schools. Let's just not fool ourselves into thinking there aren't extreme biases in the system that put the majority of people at a competitive disadvantage.

We will never have a true meritocracy. The only thing I've found that comes close is being a solopreneur. But we can take steps to help even the playing field by fighting for our beliefs. It would be foolish to ignore the uprising.

As an Asian-American with no private school pedigree and no multi-millions to give, I've decided to keep Financial Samurai running as insurance until my little boy grows up and tells me he wants nothing to do with learning about or running a location-independent small business. I have a suspicion, like many starry-eyed young adults, he'll enter the world thinking all is fair and right in the world. Then reality hits.

I'll probably keep Financial Samurai going forever just in case he realizes dad is right. But first, let me see if I have any Harvard readers to befriend.

Update 2021: Since publication, I've spoken to a dozen high schoolers whose parents went to some of the top universities and the consensus is that they have as much anxiety and stress about getting into these universities as everyone else. They are keenly aware of how competitive entrance is for everyone and being a legacy does not give them comfort. They are aware of students who have parents and grandparents who have donated mega millions they have to compete with.

Harvard reported it got $8.9 million Paychecks Protection Program meant to support small businesses hurting during the coronavirus pandemic. Yet, Harvard laid off all its employees and has a $40 billion endowment. Harvard getting $8.9 million in financial help seems absurd, and only hurts its reputation as an elitist institution who is taking advantage of the system. Do you still want a Harvard education?

Related posts:

The Case Against Meritocracy: Abolishingh The Entrance Exam

Three White Tenants, One Asia Landlord: Doing What Asians Can To Survive

About The Author

86 thoughts on “The Rapid Depreciation Of A Harvard Education: How Private School Grads Can Still Save Themselves”

  1. Dear Sam,

    I am a first generation Japanese American who grew up in rural Ohio in the 70’s. I can certainly relate to this article as I experienced racial discrimination throughout my childhood. Given my background, it was very difficult getting my first job as employers assumed that I do not speak English. Equipped with a MS in Computer Science with a 4.0 GPA from a second tier school, I could only land 2 interviews. I received offers from both companies and settled on Price Waterhouse in NYC as a Computer Consultant where I was an anomaly as the only Asian professional.

    I ran a business for 15 years before moving to Singapore to look for work. Sam, I think you are thinking of going back to work. Your assumptions about employers impression of business owners is correct. I had this exact challenge. You can turn your disadvantage to an advantage by addressing all the objections that they may have. You are successful because you have this exact skill. Successful business owners understands what the customer wants.

  2. As a parent of a current Harvard student, I found this article very interesting. My child is part of the 86% acceptance rate group. Even so, it required a 4.2 GPA on a 4.0 scale, 33 ACT, and above average SAT scores to get “accepted” as an athlete. A non-athlete would not even have a remote chance at acceptance with these numbers.

    We are a middle-class midwest family with both parents being the first generation public university graduates. It was a very tough decision to go with Harvard due to the high costs vs. scholarship offers from midwest public universities. But after multiple discussions with some Harvard graduates, it became an easier choice. These people were all very successful in our area and all basically said the same thing as someone else in the responses. “Friends will get you places your resume never will” and you will meet friends with connections at Harvard that you would never meet anywhere else. Some other things they all mentioned are also things that you point out in your article. (be someone who others want to be around, you are an athlete at Harvard, you are not a legacy or donor, you come from a middle-class family, you grew up in the midwest)

    So to answer your questions:
    Readers, do you think the reputations of elite private schools will decline once the world knows exactly how rigged the admissions system is?
    NO. If you are foolish enough to believe that the admission system is not rigged in some way at EVERY Private and Public university then I have some swampland in Florida I would like to sell ya.

    How would you advise graduates who weren’t beneficiaries of donor legacy to standout?
    Just be yourself. Let potential employers know you were not a legacy.

    Why don’t private institutions own the fact they use race, money, and legacy to craft their class now that the information is out there?
    Why doesn’t every business/university/political party do the same? Do you really think that only private institutions use race, money and legacy to get the people they want?

    If you are a parent, what will you do to help your child get ahead?
    Pay for every cent of their education, regardless of where they choose to go. Both of my kids will have graduated from college with $0 student loan debt.

  3. My father told me this:

    “Friends will get you places your resume never will”

    Kids (and parents) who go to Harvard, Yale, Princeton and don’t get this have wasted their money.

    The other thing that going to the top elites gives you is opportunity. Compare the venture capital funds availability at Stanford to UIUC…both are on par in terms of education for Computer Science and Engineering….

  4. Capitalist Parent

    Another stirring post. I recently took my niece on a tour of Boston schools and was horrified at the quoted numbers of applicants vs acceptance. Harvard’s rates are no different from many other Boston area universities of lesser acclaim who all announced numbers in the range of ~60K applicants and ~4K admissions (~6%) for the last school year.

    Based on the information you presented I won’t hesitate to encourage my child to attend my Alma Matter. Why not capitalize on my good fortune of sneaking in as a 1st generation college grad? In fact, my follow up question is if your kid is already a legacy student then how much is “enough” to be counted as a donor too? I would consider budgeting a small amount for annual donations if only to keep the door open for my child should he decide on higher education. If all of the folks above or silent readers in my same position aren’t seriously considering the same approach I would be surprised.

    However, I 100% agree with you that the ongoing trend for post education employment in most fields is not about where you went to school in so much as it is about the person you became because of where you went. The outrageous number of college grads in the US ensures that in most fields there is no longer a middle management or superior position available just because of the institution name on your diploma.

  5. I’m asian and so is my wife. Between the 2 of us, we’ve gone to top-15 non-ivy school, top-25 state school, average state school, and harvard for medical training. A family member, standout student, typically high-achieving asian extracurriculars got passed over by Harvard but ended up a prestigious non-ivy league anyway. It always seemed harvard is not necessarily looking for the best and brightest, but are interested in “personality” and “character”. Kids with more interesting backgrounds or ethnicities, who weren’t as elite got into harvard over my family member. Sure there was bitterness, but that’s life and I didn’t think it was that unknown that Harvard selects students like that. Having said that, I also don’t really agree with asians being so upset over this. At least amongst those I know, it’s harvard or bust for asian families, they’re overly obsessed with it, superficially so. Get over it. Lots of asians are high-achievers, extra-curriculars, etc. but they’ve become so common that’s it’s boring. And personally a lot of asians are rather bland, partially due to their upbringing, focus on academics, and personality, which makes great students, workers and citizens, but maybe less interesting, which isn’t wrong either. I think society would be better off with more of this asian mentality.

    Having said all that, I think the college you go to is getting less and less important these days. Sure, there are those who went ivy league that tout it, but outside of the ivory tower, no one really cares anymore. I care more about who you are, what you’ve done (besides go harvard) and what you can do. Between the various schools we’ve been too, quality of teaching isn’t drastically different, caliber of students and the overall curve is more apparent, but the most successful students are ones who study hard, get experience and are good people/workers. At least in medicine, outside of some elitist and ivory tower types, no one cares where you went to undergrad, or even med school. Where you did your training matters most. Having worked with harvard med students and doctors, there’s no discernible difference between them and others across the country. In some instances, even a harvard-trained doctor is the weaker candidate, despite lay people not knowing the difference.

    1. Thanks for sharing your thoughts. What do you think is the reason why you and your wife are so boring and bland as you said? And what are some things you guys could have done differently to make yourselves seem more interesting and appealing? Thx

      1. Generally speaking, we (as in asians) aren’t going to be loud, outspoken, opinionated or very extroverted. We keep our heads down, our mouths shut and go about our business and get things done. My wife and I weren’t high-achieving types, so no piano, language school, tutoring, hospital volunteering, etc., which probably affects personality development in those that spend all their free time doing those things. I’ve known my fair share of asian kids who spend all their time doing that instead of sports, hobbies, socializing, etc. I think it’s less common to see asian kids doing other things, things that may wow an admission committee, such as volunteering in africa, starting up some non-profit, etc. IMO, due to asian parents being traditional or not seeing that as being beneficial and because parents will be more practical and grounded, wanting their kid to be a doctor or engineer, and not seeing the worth of untraditional extra-curriculars. Not, that I disagree with them necessarily. For the “average’ asian kids, I think it’s different, they have hobbies, socialize, sports, etc., maybe more personality, but these aren’t the kids vying for ivy leagues either.

        1. Very interesting. Are these some of the traits you see in me?

          For example, I play competitive tennis and am ranked 5.0 USTA, which is in the top 1%. See:

          I’m always curious to know how others perceive me because it can be different from how I perceive myself.

          Growing up in Asia for 13 years, perception of Asians in Asia is entirely different from what you say here in America it seems. I guess that’s what happens when you are a majority versus a minority.

          I would encourage you to keep on challenging yourselves and putting yourself out there if you feel discriminated against or feel like you cannot get ahead. A boring life that isn’t filled with purpose is not worth living.

          1. Canadian Reader

            Thank You, Financial Samurai!

            It is the type of defeatist attitude that let the Ivies discriminated against Asian Americans for the last 50 years! And now Asian American kids are being kicked out of gifted programs in the elementary schools and elite high schools in a big cities that they got into fair and square! What next? State universities initiate an Asian quota too or perhaps Asian Americans get kicked out of jobs because certain professions have too many of “your typical hardworking, but no fun” Asians??!

            Since access to higher education is the ‘only key’ to a good life in America for a lot of people who have no trust funds nor great athletic abilities, why are that Asian Americans are so hesitant to fight for their rights??!

            As Asian Canadians, we pray that our government will not follow America’s “dumping down” policies in our education system! Thank goodness that merits still count for something here!

            **Please delete the following comment if it is deemed inappropriate for this forum. There is an old Cantonese saying that fits the mentality of ‘JSA’: Unlike most of us, some people, “eat feces and excrete rice!”.

        2. Asian parents traditionally focused on academics and “traditional” extracurriculars (e.g., piano, violin, debate, etc.) because they thought that was the ticket to Harvard or some other top school. In the past, that was probably the right thing to do.

          In recent months, I have heard of college counselors asking Asians to de-emphasize their Asian-ness on applications and interviews. Once Asian parents get the memo to send their kids to Africa to end world hunger or send their kids to DC to intern for a Senator, that’s what their going to do. The rules have changed but the goal is still the same. Asian parents and students will adapt to these new rules because this goal is such a powerful force in Asian families.

          I just wonder when Harvard will change it’s rules again once Asians prove that they aren’t “dull”. Harvard has a smart bunch of people–I’m sure they’ll think of something (maybe define an average height requirement goal for the incoming class?).

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top