a collaborative approach to financial education
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A Collaborative approach to financial Education. Presented by: American Student Assistance. Session Overview. Defining financial literacy The importance of financial education Developing and implementing a plan Examples of models and projects Resources and materials. Financial Literacy. - PowerPoint PPT PresentationTRANSCRIPT
Presented by:American Student Assistance
A COLLABORATIVE APPROACH TO FINANCIAL EDUCATION
SESSION OVERVIEW
• 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: $29,056– Up 4.2% from 2011-12
Trends in College Pricing 2012, The College Board
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
FY 2009
FY 2010
$801 Million
$915 Million
$1.183 Billion
$1.465 Billion
$1.533 Billion
114,128
161,951
204,507
231,659
238,852
320,194 374,940
5.1% 4.6% 5.2% 6.7% 7.0% 8.8% 9.1%
U.S. Department of Education
FY 2010 3 Year Rate
= 13.4%
ATTITUDES TOWARD DEBT AND FINANCIAL EDUCATION• Those with loans recognize:
– Benefits of financial counseling from college before graduating– Difficulties of managing money to pay loan
9
ATTITUDES TOWARD DEBT AND FINANCIAL EDUCATION
% Rating 5 and 4 on 5-point Agreement Scale
Total
Student Loan Status Age
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.
Melior Group & American Student Assistance, 2011
DEVELOPING AND IMPLEMENTING A PLAN
KEY ELEMENTS
• Perceived need/purpose • Goals and objectives• Format of program• Audience• Partners and resources• Measuring success
12
PERCEIVED NEED/PURPOSE
SALT CREATED BY AMERICAN STUDENT ASSISTANCE
Reduce Student Loan Debt and/or CDR
Improve Retention
Increase Annual Giving & Alumni Engagement
Increase Student Engagement
Position Students and Alumni for Financial success
Financial Aid Office & Media/Public Relations
Admissions, First Year Experience, and Academic Outreach
Alumni Relations & Development
Student Activities, Residential Life, Career Services
Everyone!
TRIO REQUIREMENT
2008Higher 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
• 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
• 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
• Reduce loan debt• Reduce credit card debt• Increase alumni giving• Increase # of offerings• Student interaction• Increase # of attendees
Outcomes
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
$32/week
$1664/year
One Starbucks Grande Latte
Every Weekday
$3.80/drink
$988/year
Wendy’s #2 Combo Twice a
Week
$5.64/combo
$587/year
RESOURCES
WEB RESOURCES
• 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• 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!