The cost of higher education continues to grow and at a pace well above the inflation rate. The pressure that these costs is putting on many middle class families has forced students to explore every option to fund their education including taking out government and private student loans. Even with scholarships, grants and other assistance options included, it isn't uncommon for some students to come up short by thousands of dollars each school year.

At Select Colleges, Student Loans Are No Longer Needed

A new trend in college financing may soon relieve thousands of families of their heavy burden by replacing student loans with scholarships. According to a report published in the Philadelphia Inquirer, the University of Pennsylvania plans on offering financial aid to all eligible students beginning in 2009. Currently, the cost to attend Penn is about $46,000 annually with half the students required to borrow loans which they must repay. Thanks to a $3.5 billion fund-raising campaign, Penn will be able to expand their assistance, thereby eliminating the need for students to come up with other financing alternatives.

Penn isn't the only Ivy League university eliminating student loans as Princeton and Yale have already announced similar initiatives as have other private schools including Williams and Amherst. Each school have very large endowments and it is from these funds that eligible students will receive their financial assistance.

Will the trend spread to other colleges? Only if their endowments can cover these expenses. Otherwise, we could see the day where a public university education costs more than obtaining a degree from Harvard or Duke.

Copyright 2008-2012 -- Matthew C. Keegan is a freelance writer based in North Carolina, USA. He is a contributing writer for several college-themed sites covering topics from Stafford loans to Parent PLUS Loans

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