A rising tide lifts all boats, and with the higher education trend throughout the country of increasing financial aid, Harvard may once again be swept away in greater grants.

This time, the instrument of change is the College Board, the organization that runs the SAT program, and which also plays a large role in the world of financial aid.

Experts at the College Board maintain a formula officially known as the Institutional Methodology, but commonly referred to as the IM, which is the basis for figuring out how much money a family can afford to put towards a college education.

The IM is used at nearly 400 colleges and universities, including Harvard. Director of Financial Aid James S. Miller calls the IM the "backbone" of need calculation at Harvard.

But now it looks like a change is in order. Created in the 1950s, the IM has been modified very little since its conception and the College Board now seeks to update it.

The College Board hopes to unveil a new version of the IM by this July. It will then be up to the individual schools to start using the new formula to determine financial need.

The IM worked well for very low income families, but middle income and upper middle income were "really getting whacked pretty hard," said Stanley G. Hudson, an MIT dean and financial aid officer, who is on the advisory committee looking into the IM.

"There has been a disincentive to save," Hudson says. "That was the most important concern--people at universities have seen that."

Concerns about the current aid formula resulted in a proposal by the College Board to change the IM, a proposal which is now being reviewed by financial aid offices across the country.

"In general," says Jack Joyce of the College Scholarship Service (CSS), the financial aid arm of the College Board, "[The change] would result in increased aid for many families," both in larger need assessments and also in more families qualifying for financial aid.

A New and Improved Formula

The proposal has three basic parts. The first major change addresses the apparent disincentive to save.

Because the IM now only looks at "a snapshot" of a family's income and assets, examining them only at one point in time, some families feel as though their savings are counted against them.

"It doesn't take brain science for some people to say, 'I should take my money and spend it, rather than put it in the bank,'" Hudson says.

The Board's solution: leave a certain chunk of a family's assets out of the picture when calculating how much money they can afford to give up. The size of this portion is custom-tailored for a given family, based on the number of children and their ages.

Knowing that this chunk is exempt from consideration should inspire families to save, though Hudson adds families are supposed to save for a portion of the college cost.