University of Virginia Library

Yale Adopts 'Study Now, Pay Later' Experiment

Kingman Brewster president of Yale
University, announced Friday the formal
adoption of a 'study-now, pay-later' plan
to help Yale students meet the rising
costs of education.

The Yale experiment, endorsed by
many public and private authorities, is a
new approach to financing education that
could eventually gain federal backing on a
national scale if proven successful.

When the program goes into effect next fall
students will be able to defer payment of up to
$800 per year of the cost of attending Yale.
The borrowed money is to be paid back,
starting when a student leaves Yale at the rate
of 0.4 per cent of his annual income for every
$1,000 in tuition that is deferred.

When asked if a similar plan might be
adopted here, University Comptroller Ray C.
Hunt stated that, "We have not considered this
type of plan and as a state institution such a
proposal might create problems." He added
that it is not likely that the University would
adopt our comparable system.

"As a state institution our tuition is considerably
less than that of Yale." Mr. Hunt
continued. Tuition at the University is presently
$365 a year for in state students and
$1040 per year for out of state students while
the tuition at Yale is presently $3,900 per year.
At the same time Mr. Brewster announced the
adoption of the new plan he also announced
that the total cost of attending Yale next year
will be $4,400.

Mr. Hunt further stated that, biannually the
University submits a budget request to the state
legislature and that the legislature then acts on
the University's proposals and the Governor's
recommendations. "Any adoption of a new
plan of financial aid would have to approved by
the state legislature." Mr. Hunt added.

Graduates of Yale will have to pay a yearly
minimum of $29 per $1,000 deferred, regardless
of how much they earn, the new proposal
stated. The proposal also stated however that
payments will stop after 35 years even if
low-earning graduates are still short of meeting
their obligation.

Ford Foundation president McGeorge
Bundy called the Yale venture, "a creative and
important step." Health, Education, and Welfare
Secretary Elliot L. Richardson also praised
Yale for "boldness and imagination."

Yale is the first university in the country to
put such a program into effect", Mr. Brewster
said in a news conference. He also said that he
believes that its ultimate success will depend on
whether other universities follow Yale's lead
and the federal government agrees to help out.