This is the time of year when I get calls from parents and students asking whether they should apply to college via early decision vs regular decision. This decision is a very important one, especially if you are considering some of the more selective colleges and universities in the country.

For those new to the process, perhaps it might be helpful to clarify some of the jargon.

Early Decision vs Regular Decision

Regular decision is the normal process by which students apply by published deadlines, with a promise of receiving an admissions decision no later than April 1 of their senior year. Some colleges will give admissions decisions well before April 1, but the student is under no obligation to make a decision about whether to attend until the common response date of May 1.

Early decision is a binding promise. Under this program (also known as ED), students apply early (usually by November 1 or November 15, depending on the college), and will receive their admissions decisions early–usually by December 15. In return for this early decision, the student, parents, and school counselor sign a pledge that, if accepted, they will attend that college. The student agrees to withdraw all other applications, and not accept any other offers of admission.

Early action programs are a hybrid. Students may apply early under these early action (EA) programs and receive an early admissions decision. However, the student is under no obligation to accept the offer of admission and can wait until May 1 to select which college to attend. For purposes of clarity, this post will focus exclusively on the differences between early decision (ED) and regular decision.

So When Should A Student Apply Early Decision?

I advise that students apply ED only when the college in question is clearly the student’s first choice, and when the family does not need to compare prices.

Let’s take each of these conditions in turn.

Some students are very confident in identifying their first choice college. I was. But many students still find their choices confusing in the fall of their senior year. Both my brother and sister had some ideas of what type of college they wanted. However, no institution really stood out for either of them. I applied early because I had no doubt in my mind that Dartmouth was where I wanted to go.

Some people point out that, statistically speaking, it is easier to get into a college during the ED process than during the regular process. Thus, they ask me whether it isn’t a better strategy to apply early. The answer is yes–but only if you agree to forsake all other admissions and financial aid offers.

Many colleges accept as much as 30-35% (sometimes much more–see below) of their entire freshman class in the ED process. And usually, the pool of ED applicants is smaller than the regular pool. So in a statistical sense, a qualified applicant has a better shot of admission in an ED process than in the regular process.

(For more on the statistical analysis of how this works, see the book The Early Admissions Game: Joining the Elite by Christopher Avery, Andrew Fairbanks, and Richard Zeckhauser.)

Early Decision vs Regular Decision:  Fun with statistics

However, keep in mind that what may be statistically true for an entire pool of applicants may not be true for an individual applicant. Admission is not a matter of randomized statistics. If a student does not possess at least the minimum requirements for entrance to a particular college. She will not somehow sneak past the admissions gate in the early round.

The fact is that every selective college has many more qualified applicants than space available. The students who receive an early offer of admission are just as talented and capable of doing the work at that college. (Again, if you are interested in the intricacies of how this works in practice, and the slight differences in applicant “quality”, read The Early Admissions Game). Early applicants are still judged on their merits in the early process.

So why, then, do colleges like the early decision process? Why is it in their interest to accept a third or more of their class ED? The best way to explain this is to talk about William Shatner and Priceline.com.

Early Decision, Price Sensitivity, and Priceline.com

Priceline is a website that allows you to bid the price you are willing to pay for air tickets and hotel rooms. You name your price. Then through a process of computing magic, airlines and hotels decide whether they will accept your bid. But, in return for bidding a low price, the consumer agrees to two things.

First, they agree to pay the price bid. A bidder has to submit credit card information, with the understanding that if the bid is accepted, the card will be charged. Second, the bidder cannot choose which airline or hotel will receive her business. For airlines, you can choose how many stops you are willing to tolerate.

Hotel bidders can choose the general geographical area, and they can choose the general quality rating (number of stars) of the hotel. But by bidding for a low price, Priceline customers are giving up control of important aspects of their purchase. They are trading control for price.

This sort of arrangement is good for those involved on both sides of the Priceline transaction. Hotels and airlines boost capacity or occupancy rates. Customers often get great bargains. But by agreeing to Priceline’s terms of sale, customers give up their ability to choose.

So how does this relate to early decisions in college admission? As with Priceline, an ED candidate gives up the right to certain aspects of his “purchase” of a college education. What does the ED candidate relinquish? The right to compare shops based on price. Thus ED is sort of the reverse of Priceline: name your school but agree to pay the price offered.

ED and Financial Aid: The Jewelry Store Analogy

The conventional wisdom is that a student’s financial aid package under the ED program will be lower than if he or she receives an offer of admission under regular decision. In general–and again, statistically speaking–this is true. Why? Because colleges do not need to offer discounts in the form of merit scholarships to students who make the early decision agreement.

Think about it.

You walk into a jewelry store and tell the shopkeeper, “I’d like that diamond ring and only that diamond ring…I intend to buy that ring.” The shopkeeper thus knows he has a red-hot customer, and has no incentive to offer you a discount because he is absolutely sure you will buy. He may offer discounts to other customers who are doing more comparison shopping, or who are looking at diamonds and rubies and sapphires and haven’t made up their mind about which ring to buy.

He knows that unless he offers discounts, those other potential customers may walk out the door and he’ll lose a sale. But with you, the determined buyer, he can smile and read you the price tag, knowing you will not walk out of the store without paying the full price.

How does this work for colleges? It depends on whether the college awards merit-based financial aid. Some elite colleges award financial aid only on the basis of need (more on those colleges in a second). But the hundreds of colleges compete for students by offering deep discounts and other financial inducements to bring in the customers. Colleges love ED because they need to discount much less–if at all–for those customers who walk into their office with a signed promise to buy the diamond ring.

Early Decision vs Regular Decision: The Case of Less Affluent Students

This does not mean, however, that a student who has financial need should necessarily avoid ED altogether. Many colleges, especially those that do not award merit-based aid anyway (e.g., the Ivy League). Will still award solid financial aid packages based on the family’s ability to pay.

Students with high financial needs should be able to get a solid, early offer of financial aid from an ED institution. (And since insufficient financial aid is the only legitimate reason to be released from the ED commitment to attend, financial aid offices do have good reason to work with less affluent students who are accepted under the Early Decision programs).

Still, the ED system tends to discriminate against students with high financial needs in other, more subtle ways–ways that are not easy to prove. If a student with high financial need is qualified for admission, but not necessarily a clear stand-out in the eyes of the admissions officers, she may receive a deferral to the regular round to compete for an offer with everyone else.

The reason? A high-need student costs the institution more money. If the admissions office feels that they will have to pay a heavy price (in tuition discounts or scholarships) to admit a student in the ED round, then the college may as well release the student from the ED agreement so as to “shop around” for better customers.

The Analogy Continued

To return to the jewelry store analogy, let’s say you walk into the shop and point to the ring you want to buy: this one and only this one. But then you tell the shopkeeper that you will buy it only if the price is right. You promise to pay, but only if the price is low enough. Now the shopkeeper has a different incentive. If he doesn’t know your ability to pay–but knows he must discount–he may decide it’s not worth discounting too much just to get the sale.

Furthermore, if our jewelry store clerk (like our admissions officer at a selective college) looks around the store. He’ll see that there is a long line of potential customers winding out the door and down the street. All of them are waiting to buy that same diamond ring–and a large percentage of them are willing to pay full price. Why should he offer a discount to you, if others are willing to pay full price? His incentive is to pass you by and see if the next customer is more attractive.

And that’s the rub, isn’t it? Selective colleges choose their customers!

College admission is not like any other consumer transaction we ever make. In most any other business, it is illegal to pick and choose customers. In any other business, the producer sets the price and sells the product or service to the first person who slaps down the greenbacks. Not so with colleges and universities in the US. Because college admissions officers are not only sales and marketing professionals but also social engineers. They are not only permitted but required by their bosses (i.e., the faculty) to be selective about the people to whom they sell their diamond rings.

So what does all this mean for you? Should you apply early decision, or not?

You Should Apply Early Decision If You Meet Two Basic Conditions

1. The college in question is far and away your first choice. You want this particular diamond ring above all others.

2. You are not price sensitive.

ED is not a good idea who strive to pay the lowest price for their college education.

If you don’t mind foregoing your ability to compare one financial aid package against another, then ED might be a good admissions strategy.

The one exception might be for a student with high financial need who is also a standout, both inside and outside the classroom, and who can identify a first-choice college. If offered admission in the early round, this student can work with the financial aid office to come up with a reasonable financial aid package. And the student should make it clear that if the package is not good enough. He will ask to be released from the ED and promise to matriculate.

Quality students with high financial need may very well receive a deferral to the regular round. But if a college accepts the student under ED, then that student suddenly has more power to bargain for a good package. But even in such cases, students lose the right to comparison shop: unless they go to the regular round, they will never know what sweet financial deals they might have received from another college.

Generally, I advise all my clients who are sensitive to price (regardless of their true ability to pay) to pass up the Early Decision option and apply regular decisions. This is the only way to comparison shop.

Watch Mark’s video outlining whether ED is really an advantage at top schools.

ED2 or Early Decision 2 – The Newest Twist

More recently, selective colleges and universities have begun offering two different “rounds” of Early Decision applications.

For the first or ED1, the application deadline is in early November. (However, to apply for ED at UVA, you need to have your application completed by October 15th).

ED2 deadlines are usually January 1st or January 15th. You make the same promise to attend as with ED1. Apply early and you will receive a response from the college around February 15th. And if you receive an acceptance in February, you must withdraw all other applications to other schools.

Why have colleges created ED2? Because it helps them manage enrollment better and helps them to lower acceptance rates overall. They would rather lock a student into her second-choice university. Thereby improving its standing in the rankings by recalculating two key criteria: acceptance rates and yield rates.

To explain, the “yield rate” is the percentage of students who receive an offer of admission who actually enroll. Colleges want high yield rates. Harvard’s yield rate hovers around 80-85%. Other top colleges may have yield rates that are as low as 20-25%. By raising the percentage of students accepted in ED1 and ED2 together, the yield rate is bound to go higher. The promise students make under binding ED programs means that the yield rate is 100% for students in these pools.

So the expansion of early decision programs helps colleges to achieve one of their objectives in two ways. ED programs raise their ranking by both lowering the overall acceptance rate and raise the overall yield rate. So expect colleges to press larger and larger percentages of their applicants to apply early decision.

Should you apply for ED2? Yes, if you have a clear second choice school, and you raise no red flags indicating you should NOT apply early. (Please see below).

Recent Changes in Early Decision Policies

Colleges compete for students. And they compete with one another. And it is this competition with one another that explains why more and more colleges are accepting a growing percentage of their incoming classes using early application programs.

Liberal arts colleges, for example, may accept as much as 60% of the incoming class in the early application rounds. These early decision acceptance rates help colleges to drive down the overall acceptance rates, which helps colleges to rise in the rankings.

Why? Because lower admissions rates are a key ranking criterion for US News and other rankings organizations.

What does this trend mean for you? Primarily it means that you should try to apply ED whenever possible. More and more, when people ask me whether they should apply early vs regular decision, I tell them to apply for ED. As long as they are not being foolish about it–because some people actually waste their ED chances on schools that are super unlikely to accept them.

Which brings me to another subject: when should someone NOT apply early decision?

When Should You NOT Apply Early Decision?

You should not apply early decision if you do not have a reasonable chance of admission. You should not apply early decision if your test scores and academic performance (in other words, your GPA) are generally lower than the majority of students the college ordinarily admits.

This also assumes that you are NOT one of the more privileged classes of applicants who have one or more admissions “hooks.” These hooks include recruited athletes, legacy students with a parent who attended, or underrepresented minorities.

Too often, applicants look at ED as a sort of miracle play. Students with standardized test scores and transcript grades that are mediocre will begin to think of ED as some sort of lottery: “I may not have a strong application, but hey, you never know…I might just get lucky.”

While luck plays a role in admissions, luck will not overcome lackluster test scores and ho-hum grades. Ever. Unless maybe you are Tiger Woods.

You can easily look up the “middle 50%” of test scores submitted by successful applicants to each college. If you have no hooks and you are below the middle 50%, your chances of admission at any of the top-tier schools that accept fewer than about 20% of their applicants are going to be very low. If you are in the lowest quartile of accepted applicants, your chances decrease to nearly zero.

For example, if you are a solid B+ student with a very good, but not awesome SAT score of 1350, you should not apply ED to the Ivy League. Your chances are super slim. Use your ED power where you are at or above the upper quartile of admitted students.

If You Need Lots of Financial Aid, Your ED Chances of Admission Are Lower

Furthermore, if you are a student with scores in the lower half of the pool of accepted students AND you need financial aid in order to attend your targeted college, then your chance is even lower.

Why? Because financial aid awards will go not to mediocre students, but to top students. If you need money to attend and you sit below the average academic profile. Then don’t fool yourself into thinking that somehow you will just sneak under the bar.

And the more money you need, the more stellar your academic profile must be, generally speaking, in order to make the money tree shake during the ED admissions round.

Think of it this way: would it be logical for a self-interested university that wants to lower its acceptance rates, to raise its own academic profile, and save money to accept a student who would mess up their acceptance rates, lower their academic profile, and cost them a whole ton of money? Why would a college act against its own interests in accepting you.?

Don’t let wishful thinking could your judgment. Do not waste your ED play on a school that is clearly out of your range.

Apply Early Decision to a School You Love–and that Loves You Back

If you are not Ivy League or Stanford material, how should you play the early decision game? Should you still go ahead and apply ED to the Ivy League or apply ED to Stanford anyway?

In a word: No.

My recommendation is to focus on colleges and universities that will appreciate you for who you are. You need to focus on schools in which you are in (at least) the top half of the applicant pool.

If you apply ED to such a school, you are more likely to get into the acceptance pile because you have made the promise to attend. These schools will look at your application as an opportunity. If your test scores are above their 50% line, you will help that school improve its statistics. If your grades are better than those of the average applicant, you will help that school raise its academic profile.

And if you don’t need financial aid and your family can pay the full cost of attendance, well then you will enhance that school’s bottom line.

You have given this school many reasons to love you, and if you are promising to attend if admitted…then you just helped that school lower its admissions rate, too.

And what if you are just below the average for the applicant pool at this university? Then luck–plus the ED promise–might just be enough to pull you into the accepted pile.

Is Early Decision binding or not? Check out this video.

What about Early Action (EA)?

Generally speaking, I encourage EA applications whenever a student is certain he or she finds the school attractive. Even if the student is applying to ED somewhere else, if she can complete applications for other schools that accept EA applications, I say do it.

The only exception is in the case of students who meet two criteria. First, they must have grades and/or test scores that are not yet in the “zone” for a desired college. Second, they must commit to making considerable, noticeable, measurable academic progress in the first semester of the senior year.

Keep in mind, however, that it is very, very difficult to make this academic improvement in a single semester. The last-ditch effort can raise your cumulative high school GPA by only a modest amount. And here again, wishful thinking can cloud the decision-making process.

Too often I find students who will insist that they will work hard in their senior year to improve, only to fall back into old habits and make no significant improvement at all.

Therefore, it is better to focus on applying to schools within reach at the end of the junior year. Choose schools that are within your range. Choose schools that can still offer you the opportunities you seek and satisfy your college search criteria. A successful early action application to a school where you have a reasonable chance of admission will give you a mental and emotional boost in December. Just think how good it will feel going into the winter holiday with an acceptance letter in hand! Even if this school is not your number one choice, at least you’ll heave a sigh of relief that at least one highly desirable college has accepted you.

Restrictive Early Action and Single Choice Early Action

These weird and wacky exceptions to the general ED and EA policies exist only at a few institutions. They happen to be some of the most difficult universities to get into: Harvard, Yale, Princeton, and Stanford.

These schools offer a hybrid early application process that combines elements of both early decision and early action.

First, these policies do not require the promise to attend. You can apply early to these schools without making a promise that you will attend if accepted.

Second, these policies insist that you cannot apply to other schools in their early rounds. There may be certain exceptions. For example, you may apply to public universities in your home state, or you can apply early to schools that give away scholarships only to early candidates. So you really need to read the fine print.

Why don’t these schools force you to make the promise to attend? Because they don’t need to. Their yield rates are already the highest in the country. They say they don’t want to “burden” you by forcing you into this early promise. However, realities on the ground tell us that most will say “yes” to an offer of admission to these schools. In practice, once admitted to one of these schools, very few accepted students will go on to submit applications elsewhere.

So why do Harvard, Yale, Princeton, and Stanford force you not to apply early to any other schools? Because they can. Students are so eager to receive offers from these schools that they will forego other options for the possibility–however remote–of admission to one of these super-elite universities.

Early Decision vs Early Action?

As with most things, the decision about whether to apply ED or EA depends on a lot of factors.

However, I generally encourage students to apply ED to schools that they find highly desirable. And where they stand a decent chance of admission.

I encourage all students to submit at least one Early Action (EA) application. In fact, I tell students to submit EA to all schools on their list that accept early action applications.

There is definitely an advantage to applying ED and EA. But only if you are realistic in assessing your chances of admission.

The admissions game is not a game of chance. It is not a spin of the wheel or a throw of the dice. You can reasonably asses and calculate your own chances of admission–based on a realistic comparison of your academic and testing profile with those of successful candidates in the past. Don’t believe in miracles; they generally do not happen in the world of college admission.

Nevertheless, play your hand intelligently and know how to play the admissions game. With that knowledge, you can raise your statistical chances of getting what you want from this process.