92
A Study of Student Loans and
students for each of the following five years, and 30 students for each of
the next five years, and so on. Over a period of fifteen years, 375 such
loans could be made. On the other hand, $100,000, turned into a revolving
fund, allowing $20,000 of the principal to be loaned annually for the
first five years, would be sufficient to make 1,475 such loans, which means
that it would serve
practically five times
as many
students.
It would
operate as follows:
Number of
Number of
Interest
Students
Principal and
Students
only
Served
Interest
Served
Ist year
$5,000
20
$20,000
80
2nd “
“
<<
24,000
96
3rd “
“
“
23,000
92
4th “
«(
U
22,000
88
Sth “
“
21,000
84
6th “
6,250
25
22,000
88
7th “
tl
li
25,200
100
8th “
u
“
24,150
97
9th “
u
“
23,100
93
lOth “
u
“
22,050
88
1 Ith “
7,812
30
23,100
93
12th “
<<
Ci
26,460
105
13th “
“
25,357
101
14th “
<<
it
24,255
97
15th “
<<
IC
23,152
93
Totad
$95,310
375
$348,824
1,475
The above figures should be convincing. One hundred thousand dollars
administered as a revolving fund will help 1,475 students over a
period of fifteen years, whereas it will help only 375 students during the
satne period if administered as a restricted fund. Besides helping a greater
number of students, it would attract, where well administered, more
money to be handled in this manner, whereas the amount forthcoming
when administered under the restricted plan is far from sufficient to
meet the needs. If individuals who have money to give can be shown the
good that can be derived by the establishment of revolving loan funds, they
will be more willing to leave money for this purpose. Speaking of administering
money under the revolving method, Mr. G. C. Wintringer of
Princeton University said:
A fund of this kind makes a particular appeal to me personally and I
have a feeling it should find favor with others. If an institution can demonstrate
to a prospective donor that any money given for Student aid will be
administered in a very business-like manner and can be used over and
over - again, perhaps adding to the principal by the collection of interest,
this should make a very strong appeal. It will likewise relieve the budget
of the institution of the inclusion in it of a certain sum of money each year
to be used for this purpose.
Some officials and donors fear that if the principal as well as the
inconie is loaned, the fund will eventually disappear. This fear is well
founded only if we admit inefficiency in the administration of the funds.
