BY Lake SydneyJune 27, 2022, 7:40 p.m.
Baker-Berry Library on the Dartmouth College campus in Hanover, New Hampshire, in October 2021. (Photographer: Bing Guan—Bloomberg/Getty Images)
Today, the average cost of earning a bachelor’s degree at a four-year institution is over $101,000, according to the Education Data Initiative, and student borrowers on average find themselves with $37,693 in debt. But Dartmouth College is struggling to tackle mounting debt among middle-income student borrowers.
While President Joe Biden has campaigned to agree to forgive up to $10,000 of federal student loan debt per borrower, he has yet to follow through on large-scale debt forgiveness. He canceled about $20 billion in loans, but that’s only about 1% of all federal student loan debt. According to the St. Louis Federal Reserve Bank, more than 45 million federal student borrowers owe a cumulative amount of $1.7 trillion.
At Dartmouth College, an Ivy League school in Hanover, New Hampshire, some students won’t have to worry about taking out loans to attend school. Starting June 23, Dartmouth is removing all federal and institutional loans from its undergraduate financial aid programs and replacing them instead with expanded scholarships, the school announced this week. The new policy is in effect for current and prospective Dartmouth students.
“Dartmouth has announced many new initiatives over the past year, but this one is exciting because it targets an often overlooked population,” said Dino Koff, Dartmouth’s Director of Financial Aid. Fortune. “No-loan for all-income allows students to have greater flexibility as they prepare to launch their careers.”
The cost of attendance at Dartmouth (including tuition, fees, room and board) for the 2022-2023 academic year is over $80,000 and currently the average scholarship for the class of 2025 is $62,900. One-year tuition at Dartmouth is $60,687, while the national average at a private college is $33,150.
How (and why) Dartmouth will eliminate loans
In 2020, Dartmouth set a campaign goal to eliminate student loan requirements, and more than 65 families made donations totaling $80 million.
This new policy will particularly benefit middle-income families, Dartmouth officials say. Previously, only families with an annual income of $125,000 or less were offered need-based assistance with no loan component required.
Starting June 23, however, Dartmouth has removed this income requirement and families who earn more than $125,000 a year will be eligible for the new policy. This will reduce the debt burden by an average of $22,000 over four years, according to the school’s announcement. The school also offers greater financial assistance to families earning less than $65,000 per year.
In 2020, Dartmouth President Philip J. Hanlon established the President’s Commission on Financial Aid as hundreds of families at the school faced financial hardship due to the pandemic. The commission was created in partnership with the Dartmouth Financial Aid Office to secure funding for students impacted by the pandemic, educate the Dartmouth community about financial aid, and develop a long-term financial aid program.
“Thanks to this extraordinary investment from our community, students can prepare for lives of impact with fewer constraints,” Hanlon said in a statement announcing the new policy. “Eliminating loans from financial aid programs will allow Dartmouth undergraduates to pursue their purpose and passion in the widest possible range of career opportunities.”