The cost of a Yale education will be significantly reduced for families making less than $200,000 per year, Yale University President Richard C. Levin announced on Monday.

Yale’s new financial aid plan for middle- and upper-middle class families closely resembles a Harvard plan announced in December that applies to families making less than $180,000 per year.

Under the new initiative—which takes effect this fall—Yale expects the average cost for students on financial aid to decrease by over 50 percent.

Neither school will require families earning less than $60,000 annually to contribute toward the cost of education, and families earning between $60,000 and $120,000 will be expected to pay up to 10 percent of their income.

Harvard’s plan calls for families making between $120,000 and $180,000 per year to pay 10 percent of their income, while Yale’s plan calls for families making between $120,000 and $200,000 per year to contribute that same percentage.

Neither university created hard rules, however, with Harvard noting the policy applied to families with “assets typical for these income levels,” and Yale specifying that families would pay an “average” of 10 percent of their income. The schools did not elaborate on the meaning of the phrases.

Both Harvard and Yale’s press releases gave examples of a family earning $180,000 per year. Harvard would expect such a family to contribute approximately $18,000, while Yale said such families would be expected to contribute $23,050—more than 10 percent of income—if they only had one child in college and $11,650 if they had two children in college.

Both initiatives also eliminated loans from aid packages.

In an official statement, Dean of Admissions and Financial Aid William R. Fitzsimmons ’67 said that “Yale’s announcement is terrific news for students and their families, and it is another indication that access and affordability are leading priorities for the nation’s colleges and universities.”

Fitzsimmons said the similarities between the programs will benefi students.

“The fact that there are such great similarities is a great thing for students—both work to address the critical needs of middle-income families,” Fitzsimmons said.

One major difference between the two plans is the emphasis on home equity. While Harvard has announced that it will eliminate home equity from consideration, Yale has not.

Yale said it will exempt the first $200,000 of family assets—including home equity—from the assessment of need, but home equity beyond $200,000 would be included in the assessment.

Fitzsimmons said there is a lot of misinformation in the public about home equity and how it factors into financial aid calculations.

“Many of these so-called urban myths prevented students from applying to Harvard,” he said. “There are many reasons why we felt that we needed to do away with it—home ownership is really very much a part of the American dream.”

Over the past three years, Harvard has seen a 33-percent increase in the number of students whose families earn less than $80,000 annually.

—Staff writer Arianna Markel can be reached at amarkel@fas.harvard.edu.