Benefits Beyond Affordability: U.S. Universities Expand Free Tuition Programs

Despite a 3 percent increase in undergraduate enrollment compared to 2023, the number of freshmen enrolling in college in the United States dropped 5 percent in the fall of 2024, according to the higher education nonprofit National Student Clearinghouse. It’s the first decline in freshman class sizes since the drop during the COVID-19 pandemic. 

While there are a slew of contributing factors, rising tuition costs are likely a major component. Colleges with high shares of students who receive Pell Grants, a federal grant designed to help students from low-income households with college costs, are experiencing the most significant wane in freshman enrollment, according to the clearinghouse. Fortunately, a number of U.S. universities added or expanded free tuition programs for the coming school year.

New thresholds for free tuition

On that list is the Massachusetts Institute of Technology (MIT), where free tuition will be available to students from families that earn up to $200,000 annually. Previously, the cutoff was $140,000. For those from families making under $100,000 a year, families won’t be expected to put any money towards fees, housing or meal plans either — a policy known as zero parental contribution. 

While these students will still need to pay for other college-related costs, they’ll also receive an allotment for textbooks and expenses. Eighty percent of U.S. families fall under the threshold for free tuition and half qualify for zero parental contribution, according to MIT.

Likewise, nine institutions in the University of Texas System increased the threshold for free tuition from $65,000 in yearly familial income to $100,000. Carnegie Mellon University, St. John's College and Brandeis University are introducing free tuition for those from families with a yearly income below $75,000. Brandeis University will also discount tuition by 50 percent for students with familial income up to $200,000.

Despite the attention free tuition garnered following these announcements, it is not an entirely new concept. “Free tuition has existed at many Ivy League universities and Ivy League Plus universities for a very long time,” said Shaan Patel, the CEO and founder of Prep Expert, an education company that helps students improve their SAT and ACT scores and apply for scholarships. 

But those thresholds were typically low, with many families above the limit still unable to afford the cost of tuition, Patel said. Ivy League Plus describes similarly prestigious schools to the eight Ivy League schools in the United States. MIT is one example of an Ivy League Plus university. 

“What MIT has done with their $200,000 threshold is really raised the bar,” he said. “They've really opened up the threshold, which was necessary with the amount of inflation and the cost of living that has increased so much.”

Patel said he is hopeful that other universities will follow MIT’s lead. Doing so could be a powerful step toward fixing the affordability crisis in post-secondary education in the U.S.

The benefits for schools, students and families

Higher income thresholds for free tuition will likely encourage more students to see applying to these institutions as worthwhile, Patel said.

That benefits the universities, allowing them to pick and choose top talent from a larger pool. As Sally Kornbluth, president of MIT, told MIT News: “We’re determined to make this transformative educational experience available to the most talented students, whatever their financial circumstances.”

But it also benefits those who get in. Free tuition allows students to take more risks and follow their passions instead of focusing on safer paths for fear of affording student loans, Patel said. As a result, he expects to see more graduates following an entrepreneurial path.

Then there’s benefits that extend past school, like achieving the seemingly lost dreams of owning a home, buying a car or starting a family. The difficulty of reaching those dreams for many young- and middle-aged adults appears to be linked at least in part to the massive amount of student loan debt in the U.S. 

“If you don't have a significant amount of student debt, you will be able to take on other kinds of debt,” Patel said. “For example, home ownership has gone down in the millennial generation and Generation Z, and part of that is because we are straddled with a ton of student debt.”

Patel is also hopeful that parents of students who are able to attend college tuition-free will be better equipped to plan for retirement. Any money parents aren’t shelling out for tuition could potentially go into a retirement fund.

“I think you'll see a ton of positives, both for students and the universities and society overall,” he said.

Expenses beyond tuition 

College comes with significant costs beyond tuition. There are textbooks to buy, additional fees to pay, living expenses like rent and food, and transportation costs, among others. As beneficial as MIT’s zero parental contribution option will be for students from families that meet the $100,000 annual income limit, most students who enroll at an institution with free tuition will still need to come up with funds for these costs.

“If you are lucky enough to qualify for one of these free tuition programs, your job is not done,” Patel said. “Which means that you still need to apply for other scholarships out there — private scholarships, public scholarships, as well as grants — to try to offset the cost of the rest of your education so it can go down to zero, if possible.”