Elizabeth Coogan and Ed Pacchetti | Nov U.S. Department of Education 2012 Fall Conference Financial Literacy “What” Students Need to Know Session 27

What We Are Covering “ What” Students Segments of student borrowers at risk Common characteristics “What” are the Financial Literacy Basics Budgeting Borrowing Repayment Strategies “What” are Schools Doing to Promote Financial Literacy? 2

What Students to Target Students at risk of non-completion Students at risk of default Students at risk of taking on unsustainable amounts of debt 3

Characteristics of Non-Completers Students taking remedial courses Students working more than 20 hours per week Students with limited financial resources Students attending school part-time Students attending for-profit schools 4

Characteristics of Defaulters Students who do not complete a program Students who attend for-profit schools Students who rely on private loans Students who borrow much more than the average Students from low-income backgrounds 5

Unsustainable Debt 7% of undergraduate borrowers have loan balances over $50,000 46% of graduate borrowers have loan balances over $50,000 6

Risks Related to These Segments Borrowers who dropout of school are 4 times more likely to default on their student loans 16.8% of borrowers who dropout of school default on their loans, compared to only 3.7% of borrowers who graduate 7

High Amounts of Debt (>$50,000) by Age Source: NSLDS borrowers as of June 30, 2012 with open loans and a balance greater than zero; age is calculated as of June 30, 2012; Parent Plus loans excluded. 8

Overlap Students from low-income groups are less likely to complete than their higher- income counterparts, which puts them at higher risk of default Low-income students are more likely to attend for- profit schools 9

What is Financial Literacy? GENERAL DEFINITION The ability to use knowledge and skills to manage financial resources effectively for a lifetime of financial wellbeing Annual Report, President’s Advisory Council on Financial Literacy FOR OUR PURPOSES The ability for postsecondary students to use knowledge and skills to make good decisions related to budgeting, borrowing, and repayment strategies. 10

The Basics Budgeting Borrowing Repayment Strategies 11

Budgeting 12 IncomingOutgoing GrantsTuition & Fees ScholarshipsBooks & Supplies Work-studyHousing College Savings PlanTransportation Family AssistanceFood Individual IncomeHealth Care LoansEntertainment Loan Costs $$$

Borrowing Federal Loans vs. Private Loans Maximizing other sources Minimize borrowing 13

Repayment Strategies Basic fundamentals of a loan Repayment benefits of a federal loan Who to contact and keeping in touch 14

Federal Student Aid Resources Financial Awareness Counseling Tool (FACT) Session #9: Loan Counseling Tools Session #13: Default Aversion Activities Federal Student Aid Session #25: Hands-On StudentAid.gov 15

Things To Consider Things to consider when implementing your own program What type of program delivery makes sense Institutional resources Possible external partners Methods of outreach 16

Resources White House Toolkit – Page 28: Higher Education A Guide to Increasing Financial Capability among Students in Higher Education you-think Student Financial Literacy, Campus-Based Program Development Sonya L. Britt & Dorothy B. Durband,

Did you know… A full 80 percent obtained at least some of their student loan information from their college’s counselors or website. 6,500 undergraduate and graduate respondents Citation: NERA Economic Consulting on behalf of Young Invincibles (2012) 18

Telling Their Story University of Florida Michael S. Gutter, PhD Associate Professor and Family Economics Specialist Amanda Blanco Project Coordinator Georgetown University Marina Test Executive Assistant to the Dean Central New Mexico Community College Ann Lyn Hall Executive Director, CNM Connect 19

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Objectives General Overview of Financial Literacy at UF Student Outreach (methods of getting students to participate, are particular students sought after/mandated to attend) How does your program address: – Budgeting – Advising Students the Cost of Attendance and Amount of Borrowing – Repayment Obligations and Strategies 21

Overview of Financial Literacy at the University of Florida Major Efforts Led by –Family, Youth and Community Sciences (FYCS) Gator Credit and Spending Help (C.A.S.H.) Savings in the Swamp –Students in Free Enterprise (SIFE) Partnership with FYCS faculty and Staff –Office of Student Financial Affairs 22

Student Outreach Florida Master Money Mentor (FMMM) Recruiting Volunteers –PFFP Students Service learning –Internships –Practicums Financial aid counselors –Training –Referrals 23

How do we reach students? Mobile Campus Social media –Facebook –YouTube #Gatorcash #PFFPUF Financial Education Seminars –Invited and promoted Networking –student financial aid, student organizations, fraternities, sororities, Florida Opportunity Scholars One-on-One Peer mentoring 24

Common Budgeting Approach We focus on semester based-budgeting –Done in groups or one-on-one Process includes –Identifying issues and goals –Tracking or reviewing expenses –Establishing a monthly budget –Spreading loan distributions out to avoid shortfall –Possibly learn to borrow less 25

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And… This becomes a tool they can use and adapt as they take on new obligations –After graduation when loans are due –Living within their means as they begin their careers Works with different apps as well if one has a Smartphone 27

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CNM Connect 38

CNM General Information Central New Mexico Community College is the largest postsecondary institution in the state. Serving over 29,000 credit students 65% minority 60% first generation college goers Average age 29 years, with children Annual income is $20,000 or less for 66% of our students 39

CNM Connect CNM Connect has over 6,411 active participants Mostly female 59% and minority 73% 71% with children 53% first generation students 67% have trouble paying monthly bills 40

What the Data Told Us Based on data from SENSE and Non Retained Students Survey Team (NRRST) –Community Connections: A strong connection to someone at the college who can help when difficulties arise –Instruction: Academic resources and modes of instruction that promote greater levels of student engagement –Financial Aid: Financial support including advisement, resources, and aid –Awareness and access to resources: Promoting access to an awareness of resources so students can use them when needed 41

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WHAT IS CNM CONNECT? Focus on student navigation and success through students’ entire experience of CNM – from pre- enrollment through completion of students’ stated goals –This is the right door –Students don’t experience silos, multiple referrals Holistic, comprehensive understanding of students’ needs and the college and community's resources Concept/place/people In person, online, and telephone support 43

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Timeline Pilot Phase students 1 PT coach 1 campus Intermediate students 1-5 coaches within one school 1 campus Contact Center initiated Institutionalization ,411 students 10 coaches 30 Connect staff 7 campuses 45

Students Served 46

Contact Information Ann Lyn Hall

A Call to Action We must work together Your students are our customers We share the same goal STUDENT SUCCESS! 48

Contact Information We appreciate your feedback and comments! Elizabeth Coogan Senior Advisor, Customer Experience Office Ed Pacchetti Director, Customer Analytics 49