At Hildreth Institute, we are interested in innovative alternative programs to replace student loans. While proposals for tuition-free college and student debt cancellation must be part of the solution, for millions considering a higher education credential, the real barrier is not tuition and fee, but how to afford other necessities like textbooks, a computer, software and Internet access, housing, food, child care, and transportation. 

To ensure that all students, particularly those coming from historically excluded and underserved communities, can attain a higher education credential, we must take into consideration costs beyond tuition. 

Recently, we have partnered with the University of Massachusetts Boston to research and eventually develop a pilot program that would experiment with lower cost, no interest, lifetime repayment plan for college debt. 

Our co-founder, Bob Hildreth and UMass Boston Chancellor Marcelo Suárez-Orozco recently laid out details of the partnership during a public hearing with the U.S. Department of Education (see below for full testimony) Their opinion piece was also published by The Hill, read more here. As we are at the early stages of exploration and investigation of how this program could be operationalized, we are seeking feedback and insights from individuals and organizations interested in re-imagining how we finance our higher education.

Negotiated Rulemaking Testimony

Testimony of Bob Hildreth, 

President – Hildreth Institute

June 21, 2021


Good morning. I am Bob Hildreth, I co-founded four non-profit organizations, Hildreth Institute, Inversant, ZeroDebt MA, LaVida Inc., all dedicated to increasing equity in higher education.  Thank you for the opportunity to share my views on the Department of Education’s proposed negotiated rulemaking process.

Today the average student borrows $35,000 for college. But the real burden comes from the $370 payment students must make each month on that debt. Is it possible to reduce this payment to only $50 by adopting the practices of pension funds? If so a seven-fold decrease in monthly debt payments would be transformative in the lives of 43 million students holding the debt

Pension practices include 1) spreading payments over a lifetime, 2) generating revenue through investments, 3) obliging employers to contribute to employee payments, and 4) creating a rotating fund to meet future obligations.

Applying these practices to financing college would create a low cost, no interest, lifetime investment plan for students. The government initially would fund investments out of its current annual appropriation for the student loan program as students choose between loans and investments. But overtime the rotating fund would pay for investments. Payments would be divided into 50 years or life expectancy. They would be deducted from pay for those who work. Those who do not work would have their investment written off.

Corporate contributions would expand today’s practice of many companies which provide help for employees to pay their student debts as part of their standard benefit package. As payments are received from students and employees, they would be invested in treasuries to build revenue in a rotating fund. Because payments could be simply calculated by eliminating interest projections, students would know their future obligations with ease and certitude.

Taxpayers’ losses from the present student loan system are large and growing due both to embedded forgiveness and defaults. The structure of investments could substantially decrease these losses by making student obligations very manageable.

Investments could be combined with loan forgiveness and may even enhance its chances of passage as losses from past loans would be tied to investments with much greater surety of being paid.

To test a no interest, lifetime investment proposal we shall apply for a repayment waiver from the Department of Education. With this waiver a university could conduct a pilot by offering investments to students. Hildreth Institute has joined with UMAS Boston to test this proposal through a series of focus groups.