The University of Utah has received a $335,000 grant from Lumina Foundation to assess the effectiveness of its newly launched Invest in U program, an income share agreement program aimed at helping students finish their degrees faster.
The grant also will allow the U to develop and highlight best practices and innovative models with other large, public universities interested in exploring income share agreement and other degree completion programs.
“We are thrilled to have Lumina’s support in our efforts to develop new pathways to degree completion for U students,” said Courtney McBeth, principal investigator and project director. “Helping more students graduate faster is a key strategic initiative at the University of Utah and our Invest in U program is at the forefront of our effort to help stop-and-start students accelerate their studies.”
This is the first direct grant the U has received from Lumina, an independent, private foundation in Indianapolis that is committed to making opportunities for learning beyond high school available to all.
“The University of Utah’s reputation for innovation and focus on student success have positioned it to take the lead in showing how income share agreement programs can help more students finish college and succeed in a global economy,” said Terri Taylor, the foundation’s strategy director for postsecondary finance.
The U announced Invest in U in January, becoming the first major university in the Western region to offer its students income share agreement assistance. The pilot program is open to students in 18 select majors who are within 32 hours of graduating. It is intended to fill gaps in funding that often cause students to prolong their studies or quit altogether before completing a degree.
“We embrace the idea that public flagship institutions have a responsibility not only to provide an exceptional educational experience, but to lead in innovative ways to make that education affordable, accessible and achievable,” said Ruth Watkins, president of the University of Utah. “Our college completion efforts, including pathbreaking work on income share agreements, have positioned us to share our expertise, knowledge and lessons learned about this innovative financial aid tool on the national level.”
Eligible students may receive up to $10,000 per fall, spring and summer academic semesters. Students who receive an ISA, which is potentially less expensive than other loan options, agree to pay a set percentage of income after graduation for a fixed period. That percentage is 2.85 percent for three to 10 years, depending on major and amount received. Payments may be paused for students pursuing graduate degrees, engaged in voluntary service and working full time but earning less than $20,000 a year.
Invest in U is funded by $6 million in donor, investor and university money. Payments made by students after they graduate will go back into the Invest in U program, creating a perpetual fund to help future students.
The University of Utah has the highest graduation rate, the lowest average debt at graduation and the highest average beginning salary for graduates of any public institution in the state—and well above the national median. But aversion to debt, the need to work while attending school and other factors lead many students to extend their schooling or to never complete a degree, which means they delay or forgo earning potential tied to being a college graduate.
“The U has increased its six-year graduation rate by 10 percent over the past six years, but our research shows that U students’ debt aversion and lack of access to funds are significant barriers to finishing their degrees,” McBeth said. “We want to help them cross the finish line.”
About Lumina Foundation: Lumina Foundation is an independent, private foundation in Indianapolis that is committed to making opportunities for learning beyond high school available to all. The foundation envisions a system that is easy to navigate, delivers fair results, and meets the nation’s need for talent through a broad range of credentials. Lumina’s goal is to prepare people for informed citizenship and for success in a global economy.