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Doug Krizner: This week, Dartmouth College pledged free tuition for students whose parents earn under $75,000 a year. Harvard and Yale made similar moves recently. Some of the nation's top schools are becoming generous because their bank accounts are bursting. Lisa Napoli looks at a report out today on the secrets of their financial success.
Lisa Napoli: The report tracked school endowments through June of last year. The 60 richest schools in the nation averaged returns of 21 percent. Notre Dame and Duke raked in a more than 30 percent return. How'd they do it?
John Walda runs the National Association of College and University Business Officers. He says the managers of these endowments aren't the kinds of guys who park their money in sleepy old CDs.
John Walda: One of the reasons that you see better returns in the larger endowments is that they're able to take more risk. More money into private equity, into venture capital and into real estate as well.
Uh-oh. Does that mean our nation's colleges will get zapped by the subprime mess?
Brett Hammond of survey co-partner TIAA-CREFF says never fear:
Brett Hammond: I'm sure that there are endowments that had some subprime, but the good news is that they're diversified.
Even still, Hammond says, the schools are unlikely to see such blockbuster returns for the coming fiscal year.
In Los Angeles, I'm Lisa Napoli for Marketplace.