Two years after Harvard told families earning less than $40,000 that they would not have to contribute to the cost of their children’s education here, Stanford did its East Coast rival one better—or, more accurately, $5,000 better.

In addition to eliminating parental contribution for families earning under $45,000, Stanford will cut in half the contributions from families with incomes between $45,000 and $60,000, the university announced Wednesday.

Stanford’s changes will go into effect in September and affect both current and entering undergraduate students.

Stanford’s associate dean and director of financial aid, Karen Cooper, said that research showing that students from low-income backgrounds are reluctant to apply to highly-selective, private colleges sparked the decision.

“This kind of policy makes a statement to those kind of families that we can be affordable,” Cooper said. “What we like about it is that simple message that under 45 [thousand dollars] you don’t have to pay.”

The university estimates that about 1,100 students will be affected by the changes, which are expected to cost the university $3 million in the program’s first year, according to Cooper.

Other universities, such as Princeton, Yale and the Massachusetts Institute of Technology, have also increased financial aid to students from low-income backgrounds in recent years.

In addition to eliminating contributions from families earning below $40,000, Harvard also reduced the contributions of families earning between $40,000 and $60,000 two years ago.

Cooper said that Stanford chose $45,000, the same cut-off as Yale’s, because based on their data, it was “sort of a natural break” to determine the families most in need.

Cooper added that if the Stanford policy had begun at the same time that Harvard changed its policy, it may have also chosen $40,000.

“We hope that we’ll see more applications from those qualified low-income students who are scared off from the sticker shock,” Cooper said.

Cooper said that financial aid would continue to be judged on a case-by-case basis, adding that if a family earned slightly above the $45,000 line, due to special circumstances, its contribution may still be eliminated.

Stanford’s policy change comes a couple of weeks before high school applicants across the country receive their admission decisions and their financial aid packages.

—Staff writer Claire M. Guehenno can be reached at guehenno@fas.harvard.edu.