Forum Explores Emerging Debt-Free College Financing Options
Career College Central summary:
Last week, the higher education-focused Lumina Foundation and the New America Foundation, a Washington-based think tank, highlighted income sharing programs during a public forum titled “A Future With Zero Education Debt.”
The proponents discussed income sharing agreements, also known as debt-free college financing options, including the initiative known as the “Pay-It-Forward” program. This past summer, the state of Oregon approved legislation that authorizes a “Pay-It-Forward” pilot program, which is the first state-approved plan.
In general, income sharing agreements provide either funding for college expenses or tuition-free education grants to students in exchange for a set percentage of the student’s post-college salary over a certain period of time.
Armed with careful economic arguments, five proponents—each representing a distinct income sharing agreement program—touted plans that would either reduce or eliminate the use of conventional student loans by a given student. Three of the five represented private companies each explained how their respective firm develops agreements with prospective college students that cover college costs in exchange for a set percentage of the student’s post-college salary.
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