Andover Creates Plan for Parents To Prepay Tuition
The Phillips Academy at Andover, Mass., has instituted a tuition-prepayment plan modeled after similar plans offered by a growing number of colleges and universities.
Andover is believed to be the first private secondary school to offer a guaranteed-tuition plan.
"A number of colleges have done this in recent years," said Donald W. McNemar, the school's headmaster, "and we have worked to try to adjust it for Andover."
This year, tuition, including room and board, is $13,500 at Andover, one of the nation's oldest and most prestigious preparatory schools. Annual tuition increases have ranged from 8 to 10 percent in recent years.
Under Andover's plan, which will take effect next fall, parents can choose from between two options.
They can prepay up to four years of tuition in a lump sum that is equal to the first year's rate of tuition multiplied by the number of years.
Or, through an arrangement with the Philadelphia National Bank, they can prepay up to four years with a loan that can be repaid in monthly payments extended up to 14 years. The interest will be the prime rate plus 1 percent.
The guaranteed-tuition options will only be available to families who do not receive financial aid.
Two other financial options will be available to the families of the 37 percent of Andover students who receive aid.
Under one option, parents can get a loan for annual tuition expenses, and take from 10 to 14 years to repay it, without having to lock into prepaying a set number of years of tuition. Both loan options will be convertible to college loans, school officials said.
Finally, for a $50 application fee to a private firm, Knight Tuition Payment Plans, families can extend their normal twice-a-year tuition payments over 10 to 12 monthly installments.
James T. Kaull, director of business services for the National Association of Independent Schools, said he believes Andover is the first private secondary school to offer a formal guaranteed-tuition plan.
"Among the high-cost private schools," he added, "you will probably see a trend following Andover" in developing such plans.--mw
Vol. 09, Issue 16