High-Ranking Colleges and Universities Strengthen Financial Aid
A large number of selective colleges and universities have beefed up their financial aid budgets. It remains to be seen if these changes will result in the admission of more low-income and black students.
With huge and growing endowments high-ranking colleges and universities are facing enormous political pressure to use the earnings of these funds to increase financial aid and make higher education more affordable. Now that Congress is threatening legislation to require wealthy colleges and universities to spend more of their endowment earnings, many educational institutions have taken the initiative and added millions of dollars to their financial aid budgets.
This past December, Harvard University unveiled, with considerable fanfare, an extensive new financial aid program aimed at attracting students from upper-middle-class families. Under the new plan, students from families with annual incomes up to $180,000 will be asked to pay a maximum of 10 percent of the family income for tuition and other fees at Harvard. For these students, the university will provide scholarship grants to make up the rest of the nearly $50,000 annual cost of attending Harvard.
Earlier, Harvard eliminated the family contribution for students from low-income families and replaced student loans with scholarship grants.
Since Harvard sweetened the financial aid pot for all but the most wealthy students, a large number of other high-ranking colleges and universities have revamped their financial aid programs in order to compete — as best they can — against Harvard. Yale University was first to act. It announced it would increase its financial aid budget by $22 million, providing “need-based” aid to students from families with incomes as high as $200,000.
Changes in financial aid formulas may attract more low-income applicants, a group that is disproportionately black. But it does not mean that more low-income or black students will be accepted for admission. Black students and those from low-income families will continue to face enormous obstacles in order to gain admission to these high-ranking institutions. Blacks and low-income students score significantly lower on the SAT and ACT college entrance examinations. And students from these groups tend to have lower grade point averages and lower numbers of advanced courses on their high school transcripts. So new financial aid initiatives alone will do very little to increase racial or socioeconomic diversity on the campuses of the nation’s most selective educational institutions. But it is a good start. The colleges and universities will also need to beef up their recruiting efforts in order to attract black and low-income students.
Here is a rundown of some of the new financial aid initiatives that have been announced by other high-ranking colleges and universities in this academic year:
Amherst College in western Massachusetts announced that it would purge all loans from its financial aid packages. Eight years earlier, Amherst had eliminated loans in financial aid packages of its neediest students.
Bowdoin College in Brunswick, Maine, announced that beginning this coming fall it would replace loans with scholarship grants for all students on financial aid. In making the announcement, Bowdoin president Barry Mills stated that the college is the only school with need-blind admissions and an endowment of less than $1 billion that has eliminated all loans from its financial aid packages.
Brown University has eliminated loans from financial aid packages for all students from families with incomes below $100,000. Students from families with incomes below $60,000 will no longer be expected to make a financial contribution to fund their child’s education.
Carleton College has established its Access Scholarship Program, which gives scholarship grants to students from families with incomes below $75,000. The program is expected to reduce the loan debt of Carleton’s neediest students by 70 percent.
At Claremont McKenna College in Claremont, California, where 4 percent of the students are black, loans will no longer be part of student financial aid packages. The loans will be replaced by scholarship grants.
Colby College in Maine announced that it would no longer include student loans in its financial aid packages for new and returning students. This past October, Colby College had eliminated loans for students on financial aid who were residents of the state of Maine.
Columbia University announced that students from families with incomes below $60,000 would no longer be required to make a financial contribution toward tuition or room and board expenses. In addition, Columbia is replacing loans for all students on financial aid and substituting scholarship grants.
Dartmouth College also announced sweeping new changes in its financial aid program. Now students from families with incomes of less than $75,000 will no longer be expected to contribute to the cost of tuition expenses. In addition, loans will be eliminated for all students on financial aid. Dartmouth will also expand its need-blind admissions policy to international students.
Haverford College, the highly regarded liberal arts college in suburban Philadelphia, will increase its financial aid budget by 25 percent. All incoming freshmen who qualify for financial aid will receive only scholarship grants and will not have to assume any debt. Loans for continuing students will also be significantly reduced.
Lafayette College in Easton, Pennsylvania, no longer has loans for students from families with incomes below $50,000. These loans will be replaced with scholarship grants. In addition, Lafayette will place a loan cap of $2,500 for students on financial aid from families with incomes between $50,000 and $100,000.
At the Massachusetts Institute of Technology, the new financial aid package waives tuition charges for students from families with incomes below $75,000. For these students, scholarship grants will replace loans for costs other than tuition. These students will also see a reduction in the number of hours they have to work under the university’s work/study program. About 30 percent of all MIT undergraduates will qualify for the free tuition plan.
At Northwestern University, the student financial aid budget will increase by $8 million to $78 million. This increase will allow the university to substitute scholarship grants for loans for students from low- and middle-income families.
Oberlin College is eliminating all loans in financial aid packages for incoming and returning students who are eligible for federal Pell Grants. These students will now receive outright scholarship grants.
Stanford University announced that students from families with incomes below $100,000 will no longer have to pay tuition. Students from families with incomes below $60,000 will no longer have to pay tuition or room and board. Stanford will also eliminate loans from financial aid packages for all students and replace them with outright scholarship grants.
Vassar College in Poughkeepsie, New York, has excluded loans from financial aid packages for students from families with incomes below $60,000. These students will have their loans replaced with scholarship grants.
Washington University in St. Louis announced that it will eliminate all loans from financial aid packages for students from families with incomes below $60,000. Scholarship grants will replace loans for these students.
Wellesley College, the selective college for women in Massachusetts, announced that all students from families with incomes below $60,000 will have their student loans replaced with scholarship grants. Students on financial aid from families with incomes between $60,000 and $100,000 will have their debt load reduced by one third. For all students on financial aid, there will be a four-year cap of $12,825 for total debt incurred while at Wellesley.
Williams College, currently the nation’s highest-ranked liberal arts college, announced it would no longer offer student loans in the financial aid packages it offers students. Now all financial aid offered by the college will be in the form of scholarship grants. Some financial aid packages at Williams had included loans of $13,800 over four years.