The Massachusetts Institute of Technology will offer its financial aid recipients an additional $2,000 in grants, a move that echoes recently unveiled plans at Harvard and Princeton universities.
MIT’s March 2 announcement came just weeks after announcements by Harvard and Princeton caught Yale and other Ivy League university officials by surprise. Yale administrators have said they would not announce any changes in aid policy this year. MIT students now stand to graduate with less debt and to gain flexibility in their student contribution decisions.
“We want students to be able to during those brief four years take advantage of every opportunity outside of the classroom,” said Betsy Hicks, the director of MIT’s office of student financial services.
MIT has been planning the changes since late last summer, Hicks said.
Under the plan, MIT will absorb tuition increases for students on financial aid and will offer an additional $2,000 in grants to financial aid recipients.
The typical student on aid at MIT has been expected to contribute $7,600 each year and will now be expected to contribute $5,600. MIT’s financial aid office is suggesting students borrow $4,000 each year and work for the remaining $1,600.
This will mean a typical MIT graduate will incur $16,000 of debt under the new plan. Currently, MIT students graduate with about $24,000 to pay back from loans, which are usually either federal Stafford or Perkins loans.
MIT’s grant plan is similar to Harvard’s recently announced plan. Harvard students on aid will also receive $2,000 more in grants, bringing Harvard’s average student contribution down to $3,150 from $5,150.
MIT’s and Harvard’s plans allow financial aid students to chose whether they use the new grants to cover loans or student work hours.
Princeton’s plan focused on debt, announcing an initiative to replace all student loans with grants so that its students can graduate debt free.
Administrators at Yale and Harvard expressed concern that Princeton went too far by not leaving any loan obligation for students. The Ivy League, they said, has traditionally believed that students should shoulder some of the burden of their educations.
Reducing student debt is a common goal at many schools today, Hicks said. Still, she said she hopes students will look beyond the financial aid numbers when they choose schools.
“I don’t like to see things come to a sort of bidding war,” Hicks said. “I hope each family makes the decision to go based on which school is best for [its child.]”
If Yale does not follow these schools in implementing changes, students choosing between Harvard, Princeton, MIT and Yale this year will be faced with the prospect of the highest bills from Yale.
Yale administrators have said they are considering many changes including plans like MIT’s and plans offered by many graduate programs that cover the debt of students that go on to work in public service jobs.
The past three years have brought change after change to financial aid in the upper echelon of schools.
A 1998 Princeton overhaul in financial aid policies providing more aid for students from middle-income families led to similar major policy changes at Yale, Harvard, MIT and Stanford. That year, Yale increased the allotment of aid for international students by 50 percent, added an across-the-board protection of $150,000 of families’ assets and added a summer income waiver program. And just last year, the University froze students’ self-help contribution for the first time in 25 years and allowed students to keep all of their outside scholarship funds to reduce self-help. This year, Yale announced a plan to admit international students on a need-blind basis and fully meet their financial needs.