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Top Schools Raise Bar on Parental Contributions

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Recently, Stanford University made the announcement that, starting in the 2006-2007 academic year, families earning less than $45,000 a year will be exempt from contributing to their children's tuition. Also, it was announced that families falling into the $45,000 to $60,000 range will see significant reductions in the amount they are required to contribute.

A statement on the university's financial aid website states, "Our concern is that low-income families are seeing the cost of attending Stanford and ruling us out as an option before investigating financial aid options. We hope that this very clear message will encourage those talented students from low-income backgrounds to consider Stanford. Also, our experience with current students has shown that even when only a modest parent contribution is expected, students are often picking up the slack through student loans so their parents will not have to pay. With this new policy, we are recognizing that issue up front and addressing it with scholarship rather than student loans."


In order to compete, Harvard also raised its cutoff at the end of March, exempting families that make $60,000 or less a year from parental contributions. In 2004, the school set the bar at $40,000, but these new financial guidelines promise double the benefits by extending to families that make up to $80,000.

During the first year of the 2004 changes, the school saw a 24 percent increase in students from families with annual incomes of $40,000 or less; and the new initiative promises an even greater representation of lower- and middle-class students.

"There is no more important mission for Harvard and higher education than promoting equality of opportunity for all," said President Lawrence H. Summers in a Harvard Gazette interview.

Currently, of the more than 19,000 students who attend Harvard, two-thirds receive some sort of financial aid. The university hopes that the students who are benefiting from the aid will help spread the word to others with related economic backgrounds, making Harvard an option for all students.

In fact, William C. Kirby, Dean of the Faculty of Arts and Sciences, told the Harvard Gazette that, due to changes in financial aid policies and larger financial aid budgets, "Harvard is actually more affordable for many students than public colleges or universities."

Other universities raising their income-level qualifications include Yale and the University of Pennsylvania (Penn).

In 2005, Yale University President Richard Levin announced that the university's policy would eliminate families who made less than $45,000 a year from contributing to tuition, a move that was prompted by its students. After a staging a nine-hour protest, submitting an online petition, and presenting a document of suggested changes, the concerned students got their way.

Implemented during the 2005-2006 school year, the new financial aid program also included reductions in the amount that families with incomes between $45,000 and $60,000 had to contribute.

Penn has also made changes to its financial aid program, although they are somewhat less drastic due to the fact that Penn's endowment is much less than those of other Ivy League schools.

However, with 40 percent of its undergraduates receiving aid, the university is launching a fund-raising campaign in hopes of raising $325 million. This would allow the school to completely do away with loans and replace them with grants.

Penn's president, Amy Gutmann, included changing the university's financial policy in her list of goals, and she has already done away with the $1,000 summer-savings requirement and allowed students to use scholarships from other organizations in place of loans.

The effects of these changes were evident immediately, with the percentage of lower- and middle-class students applying to and choosing to attend Penn rising from 61 to 72 percent.

Princeton, however, is the only school that doesn't advertise its financial aid programs by family-income levels; it instead evaluates every student on an individual basis. The school prides itself on examining every student's economic background and making a financial aid decision based on the family's income, savings, and expenditures. School officials feel this is more reasonable than basing financial aid qualifications solely on annual income.

"The way financial aid works at Princeton is that every case is considered on its own," said Vice President and Secretary Robert Durkee in a Daily Princetonian interview. "Where we begin with any applicant for financial aid is trying to figure out how much a family can afford to pay."

Stanford University.

    


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