Transcript A Collaborative approach to financial Education

A COLLABORATIVE
APPROACH TO
FINANCIAL EDUCATION
Presented by:
American Student Assistance
SESSION OVERVIEW
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Defining financial literacy
The importance of financial education
Developing and implementing a plan
Examples of models and projects
Resources and materials
FINANCIAL LITERACY
• “The ability to use knowledge and skills to
manage financial resources effectively for
a lifetime of financial well-being.”
– The President’s Advisory Council on Financial
Literacy, 2008 Annual Report to the President
THE IMPORTANCE OF
FINANCIAL EDUCATION
INCREASING TUITION &
FEES 2012-13
• Two-Year Public:
$3,131
Up 5.8% from 2011-12
• Four-Year Public:
$8,655
– Up 4.8% from 2011-12
• Four-Year Private:
– Up 4.2% from 2011-12
Trends in College Pricing 2012, The College Board
$29,056
STUDENT LOAN DEBT
FOR UNDERGRADS
• Class of 2011: $26,600*
– Two-thirds of college seniors borrowed
• Outstanding loan debt greater than $1
Trillion**
• Student loan debt > credit card debt**
*The Project on Student Debt
** Federal Reserve Bank of New York, August 2011
CREDIT CARD USAGE
• In 2012, 35% of undergraduates had a credit card
– Down from 42% in 2010
– Average outstanding balance: $755
• 3% charged tuition (average of $2,169)
– 4% of parents charged tuition (average of $4,911)
• 80% of students carry debit cards.
How America Pays for College 2012, Sallie Mae/IPSOS
DOLLARS AND
BORROWERS IN
DEFAULT + CDR
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
$801
Million
$915
Million
$1.183
Billion
$1.465
Billion
$1.533
Billion
114,128
161,951
204,507
231,659
5.1%
4.6%
5.2%
6.7%
U.S. Department of Education
FY 2010
3 Year Rate
= 13.4%
FY
2009
FY
2010
238,852
320,194
374,940
7.0%
8.8%
9.1%
ATTITUDES TOWARD
DEBT AND FINANCIAL
EDUCATION
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Those with loans recognize:
– Benefits of financial counseling from college before graduating
– Difficulties of managing money to pay loan
ATTITUDES TOWARD DEBT
AND FINANCIAL EDUCATION
Student Loan
Status
Age
Total
% Rating 5 and 4 on 5-point Agreement Scale
With
Without
21-25
26-30
31-37
Important to pay back what they
borrow
89
89
89
90
90
87
Should receive financial
counseling from the college before
graduating
69
72
66
67
74
69
Need to be more careful about
managing their money*
71
71
n/a
75
68
64
*Asked only of those with student loans.
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Melior Group & American Student Assistance, 2011
DEVELOPING AND
IMPLEMENTING A PLAN
KEY ELEMENTS
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Perceived need/purpose
Goals and objectives
Format of program
Audience
Partners and resources
Measuring success
PERCEIVED NEED/PURPOSE
Reduce
Student
Loan Debt
and/or CDR
Financial Aid
Office &
Media/Public
Relations
12
Improve
Retention
Admissions,
First Year
Experience,
and
Academic
Outreach
Increase
Annual
Giving &
Alumni
Engagement
Alumni
Relations &
Development
Increase
Student
Engagement
Student
Activities,
Residential
Life, Career
Services
Position
Students
and
Alumni for
Financial
success
Everyone!
SALT CREATED BY AMERICAN STUDENT ASSISTANCE
TRIO REQUIREMENT
2008
Higher Education Opportunity Act Passed (2008)
Sec 646.1
(d) Improve the financial literacy and economic
literacy of students in areas such as –
(1) Basic personal income, household money
management, and financial planning skills; and
(2) Basic economic decision-making skills
POSSIBILITY FOR ALUMNI
OFFICE
Melior Group & American Student Assistance, 2011
YOUR DEVELOPMENT
OFFICE CARES!
Student loan borrowers indicated
that the reason they don’t give back
to their school is because of a lack
of financial wherewithal.
74%
Melior Group & American Student Assistance, 2011
GOALS AND OBJECTIVES
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Learn good financial decision making
Lower borrowing levels
Lower Cohort Default Rate
Get students to attend
Get students to pay attention
Collaborate with other offices
FORMAT OF PROGRAM
• In-person
– Course
– Orientation
– Workshop series
• Online
• Written material
• Counseling
– Certified professionals
– Peer-to-peer
AUDIENCE
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TRiO students
All entering freshmen
All graduating seniors
College 101 class
Greek life/residence hall groups
Commuter students
Campus organization/major
Young alumni
PARTNERS AND
RESOURCES
• Campus partners
– Find some champions: staff, faculty, students
• Community resources
– Local credit unions, banks, insurance professionals, etc.
• National resources
– Not-for-profit agencies
• Blogs and websites
– blog.saltmoney.org, studentlendinganalytics.com,
todayscampus.com, academic-impressions.com
MEASURING SUCCESS
Outcomes
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Reduce loan debt
Reduce credit card debt
Increase alumni giving
Increase # of offerings
Student interaction
Increase # of attendees
EXAMPLES OF MODELS
AND PROJECTS
CALIFORNIA STATE
UNIVERSITY SACRAMENTO
http://www.csus.edu/sfsc-ymm/
VIRGINIA TECH
http://www.finaid.vt.edu/financial_literacy/
EMERSON COLLEGE
http://www.emerson.edu/student-life/support-services/student-service-center/money-matters
TEXAS TECH UNIVERSITY
http://www.orgs.ttu.edu/r2b/
MAKE IT SIMPLE!
• School Newspaper
 Write a regular article on money management
and/or student loan basics
 Pay for advertisements in the newspaper
• School radio or TV station
• Social media tools
QUICK MONEY LEAKAGE
EXAMPLES
Dinner Out Every
Saturday Night
One Starbucks
Grande Latte
Every Weekday
Wendy’s #2
Combo Twice a
Week
$32/week
$3.80/drink
$5.64/combo
$1664/year
$988/year
$587/year
RESOURCES
WEB RESOURCES
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www.myfico.com
www.annualcreditreport.com
www.bankrate.com
www.jumpstart.org
www.afcpe.org
FAMILY ECONOMICS &
FINANCIAL EDUCATION
http://fefe.arizona.edu/
SALT
http://www.saltmoney.org
PRINCIPLES OF
EFFECTIVE PROGRAMS
• Teachable moments
• Active, experiential, and problem-based
learning
• Evaluation
Financial Education in TRiO Programs, Institutional Policy Brief, The Pell Institute, September 2009
MOST IMPORTANT
• Start somewhere
– Anything can help!
• Find campus champions to help
• Partner with community and national
resources
YOUR PLAN
• Short Term
• Identify three actions you would like to take when you
return to campus that will get you started on your road
to a financial education program.
• Long Term
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Consider the ideal state.
What resources do you need to make this happen?
Who do you need to partner with?
What does the roadmap look like?
THANK YOU!