Based on this report by NBER, Matty Yglesias nails why even smart kids coming from low-income households are “screwed” by the college admissions process:

The problem really does seem to quite literally be that most low-income kids and their families are not well-informed about the situation. They don’t know personally what kind of SAT or ACT scores are good enough to go to a selective college, they don’t know which selective colleges are appropriate for someone with their test scores to apply to, they don’t know the strategic logic of “safety schools” and “reaches”, they don’t know about need-blind admissions policies, and they don’t have any social acquaintances who can inform this. Isn’t this what school guidance counselors are supposed to be for? Indeed it is! But they’re seemingly not doing a very good job, nor are the recruiting arms of selective schools.