Enhancements to Stanford's Financial Aid Program

For Undergraduate Students

• Enhancements for 2008-2009
• Frequently Asked Questions

For the upcoming 2008-2009 academic year, Stanford has increased its need-based scholarship budget by $20.7 million, bringing the total amount to $97.2 million. The increase includes $5.2 million needed to keep up with rising student expenses, as well as an additional $15.5 million added to the base annual scholarship budget.

The university has chosen to invest these additional funds into need-based scholarships in order to make Stanford even more accessible for students from all economic backgrounds. Stanford has always provided one of the most generous financial aid programs in the country, and these new funds will make our program even better for our students and families.

Enhancements for 2008-2009

Our methodology for determining the expected family contribution toward educational costs has been adjusted in order to direct additional need-based scholarship to our families. In deciding how to distribute the new scholarship funds, we have been guided by our core values of equity and access. Below are descriptions of how the additional scholarship funds will be spent.

Zero Parent Contribution for Parents with Income Below $60,000

For parents with total annual income below $60,000 and typical assets for this income range, Stanford will not expect a parent contribution toward educational costs. Students will still be expected to contribute toward their own expenses from their summer income, part-time work during the school year, and their own savings.

Tuition Charges Covered for Parents with Income Below $100,000

For parents with total annual income below $100,000 and typical assets for this income range, Stanford will ensure that all tuition charges are covered with need-based scholarship, federal and state grants, and/or outside scholarship funds. In most cases, the parent contribution will be no higher than the standard cost of room and board (around $11,000). Many parents in this group will see contribution amounts far lower than $11,000.

More Generous Method for Determining Family Contributions

Our methodology for calculating the expected family contributions for all applicants has been revised to be significantly more generous, while remaining true to the principles of need-based, equitable distribution of funds. Changes include:

• Capping the amount of home equity in the parent asset calculation at 1.2 times the amount of total annual income
• Increasing the portion of total parent assets that are protected against assessment, for most families
• Adjusting the parent income calculation to reflect the higher cost of living in certain parts of the country
• Dividing the total calculated parent contribution evenly among multiple siblings in college
• Decreasing the assessment rate for student assets from 25% to 5% per academic year

Students Not Expected to Borrow to Meet Educational Costs

Students are no longer expected to borrow student loans as part of their financial aid packages.  Instead, students can cover their expenses by working part-time during the academic year, with a standard earnings expectation of $2,500.  The typical hourly wage for student part-time employment on campus is $11 per hour.  At this rate, students would need to work an average of 7.5 hours per week to meet the earnings expectation. Students are also expected to contribute from their summer earnings a standard minimum amount of $2,000.

Students can reduce or eliminate the earnings expectations by obtaining scholarships from outside agencies and organizations. Outside scholarships will reduce the earnings expectations on a dollar-for-dollar basis.

Frequently Asked Questions

Do the financial aid program enhancements apply to all undergraduate students?

Yes! All undergraduate financial aid applicants who will be pursuing their first Bachelor's degree, including upper-classmen (continuing students) as well as newly admitted freshmen and transfers who will enroll in Autumn 2008, will be evaluated using the new policies for the 2008-2009 academic year. This includes students admitted under the Early Action program as well as those admitted in the Regular Round. The enhancements do not apply to graduate or professional students or to undergraduates pursuing a second Bachelor's degree.

Do I have to file a special application form to qualify for the new policies?

No. The standard financial aid application materials will give us all the information we need. Please see our Application Deadlines web page for a list of required materials and priority deadlines.

What do you mean by "typical assets"?

For applicants who report total annual parent income up to $100,000, we generally consider “typical assets” to be an adjusted total net worth of less than $250,000. Adjusted total net worth usually reflects the sum of the following amounts:

• Cash, savings, checking
• Investments
• Home equity, capped at 1.2 times annual income
• Equity in real estate other than the home
• Business net worth

We do not include formal retirement assets (401k, 403b, IRA, Keogh) in our analysis.

The Financial Aid Office reserves the right to make the final determination of the expected family contribution, in consideration of all factors affecting a family’s overall financial situation and ability to pay.

My parents' total annual income is less than $100,000. Does that mean I don't have to pay tuition?

Students who qualify for this new policy will receive at least enough scholarship and grant funds to completely pay all tuition charges. You will not be expected to pay tuition charges out of your own pocket. However, you and your family may be expected to pay for some or all of your other educational expenses, including room and board, books and supplies, travel and personal expenses.

My parents' total annual income is more than $100,000. Is it still worthwhile to apply for aid?

Yes. While some of the program enhancements are limited by total income, other enhancements benefit students and families at all income levels. We review each applicant's individual situation, taking into account all family circumstances that may affect the ability to pay. If your family has unusual expenses (for example, high out-of-pocket medical costs), we will consider these factors in determining your eligibility for aid. Even if you are not eligible for need-based scholarship, we will still let you know about low-cost loans for which you qualify.

Are the financial aid enhancements retroactive to prior academic years?

No, these enhancements are effective starting in the 2008-2009 academic year. Expected family contributions for 2007-2008 and earlier will not be adjusted in light of the enhancements.

Do the new policies apply to international students?

There are many variables involved in the calculation of aid eligibility for international students, including differences in currency values, which make it difficult to say how any individual international student is going to be affected by these changes. We will continue to evaluate international applications on a case-by-case basis.

Do I need to apply for admission to Stanford in order to qualify for the new financial aid policies?

Yes. The financial aid program is available only to students who have been accepted for undergraduate admission.

Is it too late to apply for admission to Stanford?

The deadline to apply for freshman admission for Autumn 2008 has passed, and late applications cannot be accepted. Transfer applicants for Autumn 2008 can apply for admission through March 15, 2008. The Undergraduate Admission website provides information about the admission application process, including deadlines.

Why didn't Stanford announce the financial aid program enhancements earlier?

The decision to increase financial aid funding for the upcoming year was not finalized until the university's Board of Trustees met in mid-February.

What if I still have specific questions?

We encourage you to call or visit the Financial Aid Office. Our toll-free phone number is (888) 326-3773. We are located in Montag Hall, 355 Galvez Street. We are open from 8:00 a.m. to 5:00 p.m. Pacific time (10:00-5:00 on Tuesdays). Please note that our office will be closed all day on Wednesday, February 20, 2008 for staff training. You may also submit questions by email; our email address is Financialaid@Stanford.edu.