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Tuition will increase 3.9 percent to $40,732 in the 2011-2012 academic year, according to a release from the MIT News Office. While the financial aid budget is also rising 5 percent to $91.3 million, the student self-help costs will increase from $3,400 to $4,400 for students with annual family income of $75,000 or less, and from $5,500 to $6,000 for the other financial aid recipients.

The 5 percent increase in the financial aid budget next year is notably smaller than recent years. In addition, an expanding student body appears to further complicate the net effect of that increase. According to Dean of Admissions Stuart Schmill ’86, the undergraduate enrollment will grow from 4285 to approximately 4350 next year. This means that the financial aid budget per student will increase by only about 3.4 percent, marking the first time in recent years that tuition will outgrow the per capita aid budget.

Elizabeth M. Hicks, executive director of Student Financial Services, said looking at the financial aid budget per enrolled student is an oversimplification of the budgeting process. She said the budget was deliberated after they concluded that the economy has improved and that family contribution in the past few years has been stable or decreasing. Therefore, they expected that on average, parents will be able to pay a little bit more.

“We are in a situation now where we are stemming the growth in the undergraduate financial aid budget. That’s been a strategic decision,” said Hicks, explaining that the financial aid budget in the past decade has been growing at a faster pace than tuition. In any case, Hicks said their budgeting ensured that the full need of every MIT student is met.

Nevertheless, the student self-help costs have gone up significantly for next year, especially for students from low-income families. Hicks clarified that self-help is in fact a part of the financial aid package, and a way for students to meet their need by working or taking out loans. “If you look across the nation, the number one type of aid students receive is loans,” said Hicks.

Hicks said they felt comfortable increasing the self-help level this year mostly because MIT is one of the few schools that have the generous policy that allows students to replace self-help with outside awards and is the only elite school (among Stanford and Ivy League schools) to allow Federal Pell Grants to replace self-help instead of the MIT scholarship gift-aid.

As to why self-help rose more for students with family incomes under $75,000, Hicks said that students from higher-income families actually take out more loans, and Pell Grants primarily go to families making under $50,000. “We felt asking those under $75,000 to do more was the fairest,” said Hicks.

“We appreciate that the self-help level rose this year but believe that by matching government grants we will still be able to help students from lower income levels come here,” said Daniel E. Hastings PhD ’80, dean for undergraduate education. “In addition, even with the modest increase, the potential indebtedness is reasonably commensurate with starting salaries when a student goes to work.”

Hicks said self-help cost was $8,600 around 1998, far higher than the current level. They have made a concerted effort over the years to bring it down, most recently to $2,850. But in an effort to slow down the growth of the financial aid budget this year, they felt raising self-help was the best solution. So will the self-help level decrease in the near future? “Hard to say, but probably not,” said Hicks.

When asked whether she thinks students will have a financially more difficult year coming, especially with the rising costs of housing and dining plans, Hicks responded no, as they have taken all those increases into account. She admitted, however, that some students who didn’t have to take out a loan before might have to do so next year. She thinks, however, that it’s a wise investment.

But apparently, the announced financial aid budget isn’t a cap. Sarah B. Brady, a senior financial analyst from the Office of Budget, Finance and Treasury, said, “We award financial aid according to policies that are set. And if it means that we have to spend more on financial aid than what we’ve estimated, we do so.” Hicks concurred by citing that they went over the budget for financial aid in 2008 amidst the sudden economic downturn.

Following this increase in tuition and self-help, a reasonable concern is whether there will be a negative impact on the yield of new MIT admits choosing to attend the Institute. Schmill does not think there will be too much change. He also does not think that there is a relationship between financial aid changes and the enrollment increase, as the full needs of all students are met.

“Yes, there are issues we need to manage with an increased enrollment. But I am a very strong supporter of increasing the class size. Not only will it allow MIT to increase its impact on the world by educating more students, but also more students on campus will enhance the living and learning environment for all,” said Schmill.

Hicks said MIT has one of the most generous financial aid programs. “Our yield for the students [whose families make] under $75,000 is much higher than our yield for students above $75,000,” said Hicks. She also cited MIT’s need-blind admission policy for both domestic and international students as an example of MIT’s generosity.