Lowering Student Debt- Reversing the Upward Trend Presenter Tim Bakula Associate Director of Student Financial Aid, University of Northern Iowa

University of Northern Iowa Public, 4-year and above Iowa’s number-one teacher education program 12,159 students 87% undergraduates 90% of students are from Iowa Costs o In-state, Undergraduate Tuition: $7,685 o On-Campus Room and Board: $7,820 o Overall In-state COA: $18, staff, 1 graduate assistant, approximately 30 student employees

The Project on Student Debt 2007

National Trends

UNI’s Average Debt Upon Graduation

Student loan indebtedness decreased by 7.6% currently averaging 23,575 from 25,523

Contributing Factors Federal TEACH Grant Program Financial Literacy Initiatives Private Loan Counseling Combined efforts of these programs over the last 3 to 5 years resulted in the reduction to student debt

Federal TEACH Grant Program Participated since inception 5 years ago Provides $4,000 per year for a total of $16, recipients per year for $2.28M Nationally the #1 public university in dollars & #2 in number of students

Federal TEACH Grant Program First & Second Years o FA point person established & University buy-in o Created posters o Marketed to students in appropriate majors o Students initiated the request to be awarded Third Year o Packaged students that had the award in prior year and still eligible o Trained student workers to assist with counseling Fourth year and currently o Batch packaging all students with eligible major

Financial Literacy Initiatives History Through Fall 2010 o Financial Aid was the only department working on financial literacy initiatives o Presented to classes and residence halls by request o Registered with Cash Course in late 2007 o Provided in-office counseling by appointment Determining how much aid to accept Private Loan counseling Budgeting basics

Financial Literacy Initiatives Increased efforts three years ago Live Like a Student courses Money management & awareness outreach Marketing tools Participated in First Year Experience (cornerstone classes) More than 4,600 students have participated in initiatives

Infancy of “Live Like a Student” Overwhelming amount of material o Used NEFE High School Financial Planning o Wanted sessions to be in person o Concept born from Speed Reading and Effective Study Strategies classes Needed to be relevant to the needs of college students

Marketing tools University Relations o Created logo and materials New Freshmen Orientation o Biggest advocates were parents Dept. of Residence, other Student Services Attended Dean’s and various other faculty meetings

Live Like a Student- Course Structure Relatively small, in person classes were important o Enrolled 15 students per session o Engagement and discussion have been tremendous, especially from grads and non- traditional students Venue also played critical role o Class is currently offered in a centralized location on campus as well as a campus computer lab when needed Timing o Offered on same schedule as regular courses Student led courses o Utilized Graduate Assistants to lead the classes o Allows for better connection, great experience for student leading the class Incentives for attending o $500 “Live Like a Student” scholarship was drawn monthly

Live Like a Student- Course Content Focused on basic principals of money management 5 key competencies o Goal Setting & Budgeting o Financial Aid (2 sessions) o Understanding Credit o Credit Cards o Identity Protection Relate these concepts to their lives as college students o Personalization is critical

Financial Literacy Outreach Financial Literacy Month o Interactive Scavenger Hunt o Campus Quiz Bowl o Speakers Series Cornerstone Classes Workshops

Financial Literacy Future Four Year Financial Literacy Plan geared at targeting students based on needs of their grade classification Continue expansion into campus community o Additional peer mentoring experiences o Peer Advisors in Residence (PAIR) o First Year Experience Courses Enhancing online opportunities to explore financial literacy topics

Private Education Loans

Private Education Loan Counseling Most significant contributing factor Comprehensive, thorough, all-inclusive, one-on- one Step by Step o In started one-on-one counseling with students wanting to borrow $10,000+ o In added all first-time borrowers and no loan certified if remaining federal student loan eligibility o In started counseling all students with every private loan requested and each year thereafter o No preferred lender list

Private Education Loan Counseling Content Budget worksheet (completed with the counselor) Loan repayment chart Projected income versus loan payments Types of payment plans Awareness o How much borrowed to date & lender(s) o Terms of the private loan (origination fees, interest rate, variable interest rate, consolidation, separate payments from direct loans) o Federal loan servicer information

Results of Private Loan Counseling First-time borrowers o Many reduce the amount or decided not to borrow Second-time borrowers o Come prepared and borrowing responsibly Today we see approximately 500 students per year Today average private loan debt is $12,196, was $17,892 in (-$5,696 a 31.8% decrease) 329 students graduated with private education loan debt compared to 597 in (44.9% decrease)

In Summary Combined efforts of these programs over the last 3 to 5 years resulted in the reduction to student debt o Federal TEACH Grant Program o Financial Literacy Initiatives o Private Loan Counseling

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