Endowment-rich Stanford University is sweetening financial aid for middle- and upper-middle-income students who attend the Palo Alto-area campus.
Under a new policy, the expected parental contribution for tuition will be waived for many undergraduates from families with incomes up to $125,000 a year -- up from the previous threshold of $100,000. And parents with incomes below $65,000 generally will not have to pay for tuition, room or board -- up from the previous limit of $60,000.
However, Stanford will not be free for those students. Outside of their family's contribution, students still will have to come up with $5,000 a year from such sources as work-study and summer jobs plus a small percentage of savings, according to a Stanford spokesman.
And the family calculation is based not solely on income. Families with assets over $300,000, outside of retirement savings, generally do not qualify, according to Stanford; home equity counts up to 1.2 times families' annual income.
The financial aid improvement is made possible in part by Stanford's enormous endowment, which was listed at $21 billion last year, the fourth-largest in the nation. Stanford last year raised about $928 million in donations, second in the nation only to Harvard's $1.16 billion, according to a study by the Council for Aid to Education.
Stanford provost John Etchemendy said in a statement that the aid "enhancements will help even more families, including those in the middle class, afford Stanford without going into debt."
About half of the school's undergraduates receive some financial aid from Stanford, but a spokesman said he did not know how many more families would be helped by the new policy.
Tuition at Stanford next year will be $45,729, which is 3.5% more than this year, and room and board will cost about $14,100.
Some of the other most wealthy and prestigious universities around the country have been taking similar steps but using various calculations.
For example, Harvard generally gives a complete free ride to students from families earning less than $65,000 and expects parents with incomes up to $150,000 to contribute no more than 10% of their income on a sliding scale.
Princeton charges nothing to students from households below $60,000 and waives tuition to those up to $140,000. Dartmouth charges no tuition to those with family incomes up to $100,000.