it’s never too late for financial education

It’s Never Too Late for Financial EducationChris Conway, University of

PhoenixBrett Frazier, EverFi

Sara Wilson, USA Funds

2

Financial Education: A College’s Perspective- Why?

• Colleges currently measured on default rates– It can’t only be about a school’s

default rate • The end goal is student success– Reduced delinquency– Reduced default– Lower student loan debt–More non-loan resources used to pay

tuition 2013 Knowledge Symposium

November 5-7, 2013 ● St. Pete, Florida

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Financial Education: A College’s Perspective- How?

• Student lifecycle:– Enrollment– Student–Withdrawal/Graduate– Repayment

2013 Knowledge Symposium


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Financial Education: A Guarantor’s Perspective

• Financial education resources initially provided to support default prevention efforts.

• An evolution of offerings —paper and presentations to online courses.

• Measurement? Who needs measurement?!?

• Biggest lesson learned: If you build it, they probably won't come.



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The BIG Question: How Do You Know it Works?

• “Doing no harm” does not equal “doing good.”• Attribution vs. Contribution.

Measurement Focus USA Funds Life Skills ResultsVolume and exposure to materials

• 117,648 unique users.• 397,697 online lessons completed.• 200 schools set up as of 9/30/13.

Satisfaction with program

• 4.2 out of 5 average student satisfaction score.

Knowledge and ability to apply newly learned skills

• 88 percent average assessment score.• 3.4 out of 5 average reported knowledge before training. 4.4 out of 5 average reported after.

Participant planned actions

• 94.4 percent reported an intent to change behavior.

Changes in behavior • 94.3 percent reported an actual change in behavior.• 11 positive behavior changes per student on average.2013 Knowledge

SymposiumNovember 5-7, 2013 ● St. Pete,

Florida

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What’s Coming?• Financial education

throughout the student lifecycle.

• Schools are on board with this idea.

• What can we do to support their efforts?

YearAverage Courses

Completed Each Month

Total Courses

Completed

2010

875 10,504

2011

5,816 69,788

2012

11,837 142,027

2013

18,872 225,000*

*Projected total – 188,722 through 10/20/13



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The Impact of Financial Concerns on College Student Persistence

“The number one reason for students leaving college is debt and financial stress, followed by poor academic performance and poor social fit”

— Hoffman, Mckenzie, & Paris, 2008; Chiang, 2007



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Two Research Reports• “Money Matters on Campus: How Early

Attitudes & Behaviors Affect Financial Decisions of First-Year College Students.”– www.moneymattersoncampus.org– 40,000 first-year college students from across the

U.S. in 2012– Conducted by EverFi and sponsored by Higher One

• Financial Literacy & Higher Education: 2012 Survey

–30,165 Incoming college students–Knowledge, Attitudes & Behaviors–Leveraging the EverFi education platform



http://www.moneymattersoncampus.org/

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School Loans in context

73% of students report that they already have or plan to take out college loans before they leave college

Only

~24%

report “likely to consolidate” and other issues (e.g. knowing interest rate, only taking out what they need)

but 68%

estimate their final school loan total will be between $10,000 and $40,000



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The State of College Student Financial Behavior

28% of students reported that they plan to buy something even though they can’t afford it

32% of students report frequently making only the minimum payments on their credit card

11% of students reported at least a moderate likelihood of going to a payday lender

13% of students reported writing a check even though they knew they didn’t have enough money in their bank account to cover it

19% of students reported at least a moderate likelihood of using a credit card for a cash loan



Alarming Financial Attitudes79% OF STUDENTS REPORTED THEY WORRY

ABOUT DEBT“Banks should not be surprised when students incur debts”

73% agree“I like to own things that impress people”

60% agree“It’s OK to have an overdraft fee if you can pay it off”

60% agree“Students have to go into debt”

41% agree“It’s better to have something now and pay for it later”

31% agree

Contributing factors to financial stress • 6

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What’s Needed?

2

1

34

We need a developmental perspective

Late timing, knowledge-based education might not be enough

Early-onset, with periodically-based booster

Population-level education



13

QUESTIONS FOR PANELISTS



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• What have you had the most success with?– How do you define success? –What statistics do you have to show

this success?



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• What are you hearing from your university customers about these offerings?

• What are you hearing from students about these offerings?



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QUESTIONS FOR ATTENDEES



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• Are you doing anything to improve the financial literacy of your student customers? – If not, do you have plans to do so?

• How do you currently follow up on rehabilitations in process? – How could financial education be

used to reduce rehab drop-out rates?



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• More and more schools have roles focused on the First Year Sequence, retention and financial literacy. How does that impact the work you do?

• What do you hear from students about why they can’t pay? What your sense of their financial capability?



it’s never too late for financial education

Documents

average reported knowledge

student lifecycle

floridafinancial education

florida2financial education

college loans

year college students

financial stress

financial decisions