Financial Literacy and Student Success, WyASFAA 2010

Why do I care? What and how do students want to learn? Who should I focus on? How can I incorporate financial literacy at my school? What do I do to ‘get the word out’? Why start in the middle? Moving from planning to implementation And then some final thoughts…. ….Guiding Students Through the Money Maze

Financial Literacy and Student Success The Current State of Affairs Less than half of first-year students indicated they have adequate financial resources to finish college. Average student loan debt of 2008 college graduates $23,200. Average undergraduate student credit card balance is $3,173 (up 46% from 2004) and 21% have balances between $3,000-$7,000. Only 59% of year olds pay their bills on time every month.

Financial Literacy and Student Success 76% of college students wish they had more help preparing for their financial future. –Hartford Financial Services Group, % of graduate students said they would have liked to receive financial management information on an ongoing basis throughout their undergraduate years. –Graduate Students and Credit Cards, Nellie Mae,  Students that participated in as little as 10 hours of financial education increased their understanding of money management and improved financial behavior. –National Endowment for Financial Education. The Good News — Students Want This Information

Why Do I Care? It takes money to attend –Average college costs –Unmet financial need –Private loans –Affordability –Effect on persistence

Why Do I Care? It takes money to repay –Percent borrowed and cumulative debt per institution type –Average credit card debt –Access to employment / credit history –Alumni financial experiences (past and current) –Relationship to default and withdrawal

What and How Do Students Want to Learn? What topics are of interest to students? –Investing for the future –Getting ahead financially after graduation –Avoiding credit problems –Budgeting income and expenses

What and How Do Students Want to Learn? How do students want to receive this information? –As part of a financial aid interview –As part of a special event with food. –As part of extra credit in a class. –Through a Web site. –At New Student Orientation. Source: Journal of Family and Consumer Science, 2007, Vol. 99, No3. Financial Information Project: Assessing the Financial Interests of College Students.

Financial Literacy and Student Success Some suggestions: –Entering freshmen. –First-generation students. –Student loan borrowers. –Students on academic probation. –Residence advisers. –Work-study students. –Peer counselors or peer mentors. –Graduating students. –Transfer students (incoming and outgoing). –Sophomores, who you can train and then match with freshmen to help prevent the sophomore slump. On Whom Should I Focus?

Financial Literacy and Student Success Some suggestions: –Formal admissions process. –Freshman/transfer student orientation programs. –Supplemental entrance and exit counseling. –Residence hall programs. –Summer bridge programs for high school juniors and seniors. –Personal development classes. –Distance learning programs. –Student success programs. –Adult re-entry programs. –Programs to assist students on academic probation. –Partnerships with career services, student affairs, faculty and counseling staffs. –Consumer education — building money management skills. Incorporating Financial Education at My School

Financial Literacy and Student Success Or, how do I successfully reach students? –Link financial education to other on-campus events, programs and student organizations. –Make it part of the process of being a student. –Don’t be afraid to make it mandatory. Because …  “They don’t know that they don’t know!”  “They think they already know!”  “What if they held a financial literacy seminar and nobody came?” How Do I Get Students to Complete the Program?

It’s all in the way you say it

Who are you trying to reach? What are the main goals that you are trying to accomplish by implementing a financial literacy program? What will help you accomplish your goals? What special programs or systems are in place to assist your students currently? Questions You Need to Answer

How often do you plan on using the curriculum (ex. each semester, each year, one time use, ongoing)? Is it going to be mandatory for students to complete? In what departments of your school will you implement? What other departments or personnel do you think would be interested in financial literacy? Questions You Need to Answer

Making Sure it Sticks To effectively deliver information in a way that will change financial literacy habits that have built up over a lifetime, we must use two strategies: –“Edu-tainment” and –“Facili-tainment”

Moving from Planning to Implementation What are we going to do? When are we going to do it? Who will be responsible? How much will it cost? How will we know when it will be accomplished?

Some Final Thoughts………. Adopt a ‘life of the loan’ philosophy – communicate and educate over and over..… Provide ‘money smarts’ cross-training to others that have frequent contact with your students ……we all need to hear information more than once to make an impact on us. Create an institution-wide default prevention plan. Get campus advisors to ‘buy in’ – help keep students up to speed on their student loan debt total and estimated potential monthly loan payments. Take advantage of your partners.

Create a ‘money smarts’ page or section on the school website. Utilize any available ‘on-going’ student communication tools. Organize a speakers bureau – be the presenters at meetings and activities that students may already attend. Integrate financial literacy wherever you can in any way you can. Invite recent ‘local’ alums to come to informal meetings (dorms, campus organizations, etc) to share some ‘real world’ information. Never forget…It takes a team to provide financial education. Who is going to be on yours?

Get academics involved. –By far the most successful implementations to date have involved faculty. Integrating the content into courses: First Year Experience courses, finance courses, etc. have resulted in the greatest use, and the best student feedback. Bet on a sure thing. –Students will not do lessons based on the “chance” of winning a prize or a benefit. Schools have tried several methods of trying to entice students to do the lessons, but by far the best method so far has been “extra credit,” in a course or required as part of an existing administrative process. In fact, in our experience, many times zero lesson completions have resulted even when that completion may result in the chance of winning a very valuable prize (worth over $100). Tips and Lessons Learned

If you build it, they probably won’t come. –Although surveys often share that students wish they had this information or that they think they would benefit from this information, it’s not enough to just make it available – our experience is that students do not complete lessons when there is no incentive to do so. The solution is to integrate the lessons into a current student process whether that is administrative or academic. Tips and Lessons Learned

You Can Do It!

Questions Carol Buchli USA Funds Debt Management Consultant (866) , Ext

USA Funds ® is the nation’s leading education-loan guarantor. A nonprofit corporation, USA Funds works to enhance postsecondary- education preparedness, access and success by providing and supporting financial and other valued services.