Financial literacy is a critical aspect of college education that has far-reaching implications for student's life both post-graduation, as well as during their schooling. It is the foundation for successful financial management and stability in adulthood.
However, a recent Student Voice survey1 revealed that students' financial wellness is lagging far behind. Students are facing significant challenges with their finances, particularly with food and housing insecurity, and a lack of proper financial education is a big part of the problem.
The survey findings paint a clear picture of the pressing need for stronger financial literacy education in colleges and universities in order to avoid detrimental student outcomes.
Financial literacy programs and classes have long been a part of college education, but it is essential to assess the effectiveness of these programs and determine if students are even aware of their existence.
We must acknowledge the crucial role that colleges and universities play in financial education for students, and do our best to maximize the effectiveness of school programs.
What The Survey Showed
The survey, which collected data from 2,000 undergraduate students from January 31 to February 7, 2022, revealed that over half of the 2,000 undergraduate student respondents will have student loan debt after graduation, and 1 in 5 didn't know how much debt they will have.
In terms of financial insecurity, 25% of students reported experiencing food insecurity, and nearly 20% dealt with housing insecurity during college.
The survey also found that two-thirds of students work at least part-time, with almost 20% working at least 30 hours per week. This doesn’t leave a lot of time to spend studying and catching up on homework, which can have a detrimental effect on education.
Regarding the impact of COVID-19 on college enrollment, almost 1 out of 2 students reported being almost unable to attend or remain in college due to the pandemic, and this group was also four times more likely to have a current debt owed to their institution.
The survey also found that 35% of students were very worried about dropping out of college if they faced any sort of financial setback, such as a car-repair bill, and an additional 29% were somewhat worried.1
The findings of this survey are worrying, to say the least, and they really iterate how many financial issues are limiting student success.
What Does This Mean For Colleges and Universities
The results of this survey only amplify the crucial role that colleges and universities must play in equipping students with the necessary financial literacy skills and resources to succeed both during and after their college years.
To help students, schools can start to offer workshops or programs, and begin to take financial education more seriously. This can give students the skills and resources they need to be successful with their money during and after college.
By working together, colleges and universities can help students succeed with their finances.
How Can Colleges and Universities Help
Given the challenges that students are facing, it's more important than ever for colleges and universities to step up and provide the support and resources students need to succeed. There are a few key ways that schools can help.2
One of the key areas for colleges and universities to focus on is offering comprehensive financial literacy programs and resources.
This can include classes, workshops, online courses, and one-on-one counseling services, all aimed at educating students on the importance of financial literacy and helping them strengthen their financial skills.
These programs should be well-publicized and easily accessible to students so that students who need them most can take advantage of them.3
Another key area for colleges and universities to focus on is making financial literacy education more accessible and relevant for students.
It’s not only important to provide adequate education in these areas, but also to make this education entertaining, engaging, and relevant to students. When numbers get involved, it’s all too easy to tune out and not pay attention.
The responsibility is on the schools to design these programs so that they can effectively reach the students they are targeted to.3
Furthermore, colleges and universities must take a proactive approach to educate students on the importance of financial literacy and provide them with the tools and resources they need to strengthen their financial skills.
This includes promoting the value of savings, budgeting, and credit management, and offering practical advice and resources to help students make informed financial decisions.
Additionally, colleges and universities must be prepared to support students in times of financial crisis. This includes having adequate support systems in place, such as emergency loan programs, to assist students who face unexpected financial setbacks.
These support systems can help students weather financial setbacks and remain in college, allowing them to pursue their educational goals and eventually achieve financial stability.3
iGrad's Personalized Financial Literacy Programs
In the end, the study shows that financial literacy education is important for college students. Financial aid directors play a big role in making sure students get the education they need.
By working together and using the right programs to help, colleges and universities can ensure students succeed with their finances.
iGrad Financial Wellness is an all-encompassing financial literacy solution that empowers institutions to offer comprehensive support to students.
The platform offers custom-fit financial literacy programs, such as financial coaching, aid in scholarship search and application, as well as monitoring and reporting tools.
Download iGrad's Compendium of the Best College Financial Literacy Programs
1 - https://reports.collegepulse.com/financial-wellness
2 - https://www.finra.org/sites/default/files/investoreducationfoundation.pdf
3 - https://digitalcommons.lsu.edu/cgi/viewcontent.cgi?article=3262&context=gradschool_dissertations