Opinion: A better way to finance that college degree

Wall Street Journal
Apr 13, 2014

The higher-education world should consider a creative student-loan alternative, writes Miguel Palacios, assistant professor of finance, and Andrew P. Kelly. Income-share agreements are essentially equity instruments for human capital. Investors finance a student's college education in return for a percentage of their future income over a fixed period. ISAs are not loans and there is no outstanding balance. If students earn more than expected, they will pay more, but they also will pay less—or nothing—if their earnings do not materialize.