Susan Thompson Buffett Foundation (STBF) award amounts are calibrated to match the cost of tuition and fees for each student based on their part-time or full-time status, plus $500 for books. Each pair of bars shows the effect of a STBF scholarship on the category listed at the bottom of the graph in the applicant’s freshman year. The two bars to the far left indicate that STBF award winners on average receive $8,158 in aid compared to their peers who receive $0 in aid from the Foundation. Compared with students who did not receive an award, award recipients receive double the grant aid and thus rely less on federal loans and work-study programs.

46 percent of award recipients finished their fourth year without any federal loans. By comparison, only 29 percent of those who did not receive an award had no federal loans after four years. STBF awards increased the share of students who had no federal loans in year four by 17 percentage points.

STBF awards boosted enrollment and cut dropout rates in half after four years. Enrollment among students who did not receive a scholarship fell from 96 percent in students’ first semester to 78 percent in the fall semester of students’ fourth year, a decline of 18 percentage points. Enrollment among students who were awarded scholarships fell by only 13 percentage points over the same period.

STBF awards also increased enrollment for students who targeted a two-year college. More than half of STBF award winners were still in school in the fall, four years after winning the award, compared with less than half of students who did not win an award. Some students who start in a two-year program transfer to a four-year school with continued STBF support.

These graphs show the relationship between students’ ACT scores and college enrollment. The first graph shows the share of students enrolled in year one at any postsecondary institution (i.e., a two- or four-year college). Enrollment rates among award recipients and other students are not very different: regardless of ACT score, both groups enroll in college at roughly the same rate.

Initial enrollment in four-year colleges differs by ACT score. Award recipients with lower ACT scores are more likely to enroll in a four-year college than are similar-scoring students who did not receive an award. Conversely, award recipients with high ACT scores enroll in four-year colleges at the same rate regardless of whether they receive an award. STBF awards appear to have shifted students with below-median ACT scores from two-year colleges to four-year colleges.

Four-year students with and without STBF awards complete bachelor’s degrees at the same rate until year five. By year six, STBF awards increase bachelor’s degree completion rates by 8.4 percentage points.

The impact of STBF awards on students who indicated a two-year school as their first choice is less straightforward. It appears that STBF awards decrease associate degree completion rates by approximately 7 percentage points. This is likely caused by students who receive a STBF award moving from two-year schools to four-year schools. Although students initially indicate interest in a two-year program, an award from STBF may ease financial constraints and appears to prompt some students to complete a bachelor’s degree instead.

University of Nebraska at Omaha award recipients are more likely to complete their bachelor’s degree than their peers who do not receive an award. 62 percent of students who received a scholarship completed the requirements for a bachelor’s degree, compared with 48 percent of students who did not receive an award, a 15 percentage-point difference.

Differences in completion rates at the other University of Nebraska campuses (Kearney and Lincoln) and State Colleges are much smaller, and the confidence intervals indicate that these differences are not statistically significant.

In the figures that follow, the research team looked at bachelor’s degree effects on four-year applicants broken into subpopulations based on ACT score, race, Pell grant eligibility, and first-generation status.

STBF awards have a particularly large and positive effect on bachelor’s degree completion rates for some student subgroups: those with below-median ACT scores,* nonwhite students, Pell grant-eligible students, and first-generation college students (whose parents don’t have a bachelor’s degree). The scholarship produces a 14, 12, 10, or 10 percentage point increase in degree completion rates, respectively.

Do the benefits of an STBF award outweigh the costs?

We offer two views of scholarship program costs.

The first is the direct cost to the Susan Thompson Buffett Foundation, which we call funder cost. The average student targeting a four-year public university costs the foundation $32,250 over the course of the student’s post-secondary schooling. For state colleges, which are not part of the University of Nebraska system, that cost is $26,770.

The second measures the incremental cost of attendance, that is, the average cost of schooling for students receiving an STBF scholarship (the treatment group) minus the average cost of educating students receiving no STBF scholarship (the control group). The treatment cost is higher than the control cost when STBF students spend more time enrolled in school and/or choose to attend a more expensive degree program as a consequence of being awarded the scholarship. The graph below breaks down incremental costs by institution.

The graph above shows the funder cost and cost of attendance for those who received an STBF scholarship and those who did not. It depicts the variation in the incremental cost of attendance among four different schools. The highest incremental cost is for students targeting the University of Nebraska-Omaha. For STBF students, the average cost of attendance is $30,870, compared with $26,030 for students who are not on STBF scholarship. Thus, the incremental cost of attendance is $4,840.

In part, the extra cost stems from STBF recipients spending more time enrolled in school, compared with control students. Also affecting incremental cost are students who end up at a more expensive school than the one they had initially targeted. For instance, upon receiving the scholarship, some students who targeted University of Nebraska-Omaha may switch to University of Nebraska-Lincoln, which has higher tuition and fees than its Omaha counterpart. The lowest incremental cost of attendance among schools included is for students targeting state colleges (as distinct from universities), yielding an incremental cost of attendance of -$290, meaning that STBF scholarship recipients spend slightly less on average than the non-recipients.

We assess the benefits of the STBF scholarship based on predicted lifetime earnings, using data from the American Community Survey for Nebraska-born respondents, ages 18 to 65. We calculate wages at each age based on degree attainment and potential work experience. Students who earn a bachelor’s degree will, on average, earn more over their lifetime than those with an associate degree. We calculate potential work experience under the assumption that the average work life spans ages 18 to 65. A student who takes five years to complete a bachelor’s degree would have one less year of potential work experience than one who takes four years.

With earnings estimates, we can compare costs and predicted benefits for those receiving a scholarship and those who did not among different groups of students.

The graph above shows different cost and benefit measures, allowing us to compare the effect of the STBF scholarship among different groups. The average predicted lifetime earnings gain is the difference between predicted lifetime earnings of those who received an STBF scholarship and those who did not. For all groups, the benefits of the program (shown in green) outweigh the incremental cost of attendance (shown in pink). This means that scholarship recipients are predicted to earn more over their lifetime than the extra cost of attendance that was incurred because of receiving the scholarship. 

Importantly, the benefits of the scholarship program outweigh not only the incremental cost of attendance but also the funder cost for some of the student groups that have been historically underrepresented in higher education, as seen at the top of the graph. These groups include Omaha residents, students who target University of Nebraska - Omaha (41.7% of their total undergraduate population was a first-generation college student in the 2020-2021 academic year), those with below median ACT scores, those who listed a community college as an alternative target school, and those with a below median GPA. These groups also have some of the highest award-induced bachelor’s degree completion rates, as discussed earlier.

Benefiting most are Omaha recipients. They are predicted to earn an average of $39,151 more during their working lives than their peers who were not awarded a scholarship. That group on average provides the biggest return on STBF investment:  $7,757 above the $31,394 foundation cost of educating the average Omaha recipient.

Among STBF recipients in groups that are predicted to realize the lowest gains are those with an above median high school GPA, those targeting state colleges, those who are not Omaha residents, and those with at least one parent who attained a BA. The STBF scholarship does not have a high payoff for these students because they are likely to complete the bachelor’s degree even without STBF support. Even for these groups, however, predicted earnings gains exceed the incremental cost of attendance, meaning that the additional college investment is likely to pay off during adulthood. Coupled with the findings on the subgroups with high predicted earnings gains, these results strongly suggest that increased targeting of financial aid awards is likely to enhance aid impact.

We emphasize that because we have only predicted future earnings at this time, rather than actual earnings outcomes for each student, these results are statistical ‘best guesses’ at expected earnings. The realized causal effects of STBF scholarship awards on adult earnings will not be known for at least a decade.