The 2019 graduating class of Morehouse College got an amazing surprise in May when billionaire Robert F. Smith pledged to pay off the entirety of their student loans. The founder of private equity firm Vista Equity Partners made the announcement during his speech at the commencement ceremony on May 19.
Now, Smith has made good on his promise, donating $34 million to pay off the student debt of the entire graduating class — including the loans parents took on to pay for their kids‘ college.
College administrators spent the summer going through their records and working with the U.S. Department of Education to figure out how much Smith would need to give to cover all of the debt, Inside Higher Ed reported.
“It was all really driven by Robert, who took his time to dig in and understand the issue of debt to finance student education,” David A. Thomas, president of Morehouse College, told reporters in a call on Sept. 20. “Once he realized that it’s not just student debt but a debt that families take out…He decided that debt needed to be addressed as well.” Thomas said it was already a “significant gift” before Smith decided to include parents’ debt for their grads as well.
Additionally, $400,000 of Smith’s donation will be used to fund research on how the debt relief will impact the professional and economic lives of the graduates going forward.
“Morehouse’s program to provide debt relief to new graduates in a fund-raising opportunity that should be studied and duplicated nationally,” Michael L. Lomax, president and CEO of the United Negro College Fund, said in a statement. “The impact of such a gift, particularly for minority or economically disadvantaged families, could accelerate the growth of a more diverse and robust middle class.”
The historic gift is especially meaningful amidst a growing student loan crisis that some economists argue doesn’t just affect the students and their families but the entire economy: For example, those saddled with huge debts that take decades to pay off may struggle to buy a car or home.
Currently, the national student loan debt stands at nearly $1.6 trillion. For Morehouse graduates, the average student loan debt threshold at graduation is between $35,000 and $40,000.
What a gift! Congratulations to the graduates and best wishes for their continued success.
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