Dartmouth College announced an adjustment to its financial aid packages on Wednesday that reduces work and loan expectations for its incoming class and adds $1.6 million to the school's scholarship resources. Dartmouth's financial aid modification is the latest in a series of similar changes at other highly selective universities.
Princeton, Harvard, and MIT have each announced changes to their financial aid programs this semester, in a trend that other institutions are likely to follow. The "ripple effect," according to William Eastwood, Tufts' director of financial aid, will not soon subside.
"If other Ivies or schools go in that direction, then it can start to trickle down to [Tufts'] competitive pool," he said, adding that, for now, Tufts is not planning changes to its financial aid structure.
Dartmouth's typical first-year financial aid student will see a reduction of between $1,225 and $1,500 annually in loans, and a decrease of $275 for the scholarship's work expectation component. These changes come thanks in part to a 46 percent increase in Dartmouth's endowment, according to an article in The Dartmouth.
Dartmouth is not currently able to extend the full changes to upperclassmen, Karl Furstenberg, the Dartmouth dean of admissions and financial aid, told The Dartmouth.
This plan comes three months after Princeton's announcement to drop the loan requirements from its typical financial aid package. Princeton, which has the greatest per capita endowment of any university in the country, eliminated university loans to lessen the amount of debt students have when they graduate.
Princeton's plan is an effort to help students reduce their post-graduation debt. "We're trying to [find] a better way to treat parents and students," said Princeton's director of financial aid, Don Betterton. The change "was more dramatic and more expensive because Princeton had an influx of money to join other money put aside," he said. These funds came from the school's capital campaign and other donated money.
According to Eastwood, Princeton administrators made the adjustment because "they literally have more money than they know what to do with."
Harvard's decision to add $2,000 to financial aid packages and MIT's move to reduce its students' "self-help" component of financial packages followed closely after Princeton's announcement.
Harvard, for its part, decided not to replace loans completely because the schools wants to give students choice of how to finance their college tuition. After lowering the self-help amount of the financial aid package two years ago, Harvard decreased the package again, according to the school's director of financial aid, Sally Donahue.
The first change was "so successful in terms of enabling students to have greater flexibility... so they wouldn't have to work long hours, or choose to work more and borrow less depending on individual circumstances," she said.
Many schools, including Tufts and the University of Pennsylvania, do not have the capacity to make similar adjustments to their packages. "It's going to be virtually impossible for any school to do," University of Pennsylvania Director of Financial Aid Bill Schilling told TheDaily Pennsylvanian (2/2701).
Unlike Princeton, Tufts cannot draw all of its financial aid from its endowment, which makes it difficult for the school to broaden its offerings. "That would be five to six million dollars a year for undergraduates - not a minor thing," Eastwood said of the loan replacement option.
While changes in financial aid policy at competitive schools may help their admissions offices enroll quality applicants, Donahue said that schools should focus on their own communities rather than follow any national trend. "[Colleges] are all aware of what's happening in the financial aid world, but it works best if you focus on your own institution and how you can best serve all your students," she said.
The Dartmouth changes are not directly related to the announcements by the other Ivy League schools, according to Virginia Hazen, Dartmouth's director of financial aid. "Dartmouth reviews its financial aid policy every year and felt changes needed to be made. The fact that Princeton and Harvard were out there [with their decisions] was certainly impetus," she said. But the changes would have been made "regardless of whether Harvard and Princeton made changes."
Several institutions made drastic alterations to their financial aid packages three years ago during another trend in reworking aid packages. At that time, schools added money to their aid funds and reconfigured the role of outside scholarships in the package.
"Schools have been doing various things in their aid programs, trying not to lose that competitive edge," Eastwood said.
Tufts altered its policy concerning scholarships awarded by outside organizations in 1998, decreasing the loan component of these students' financial aid packages, but leaving the grant component untouched.
With the largest endowment and largest per capita endowment respectively, both Harvard and Princeton's average grants amount to $20,000. Tufts, whose endowment was ranked 87th last year, averages $14,500.
Despite the disparity, Eastwood said Tufts' packages look similar to the offerings of other schools in its selectivity range. "Our aid packages are fairly competitive. Most of the students who don't come here are not [rejecting Tufts] because of aid packages," he said.
Though Tufts does not plan to overhaul its financial aid packages, Eastwood said the University will try to keep loan and scholarship levels competitive as tuition charges rise. "As things go these days, our loan levels are not exorbitant - loan levels have not gone up appreciably in several years," he said.
