Marketing Overview August 27_ 2008 - NCASFAA by pptfiles

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									        Financial Literacy:
Key to Retention and Default Prevention


                Fall 2012
            NCASFAA Conference
What Is Financial Literacy? Why Is It Important?



• The ability of individuals to make appropriate decisions
  in managing their personal finances effectively
• Financial Literacy is critical for a healthy, sustainable
  economy and culture
• Understanding financial responsibilities and managing
  money can have a positive impact on repaying education
  loans!!
Financial Literacy – or Illiteracy Statistics



• High School students’ survey administered to 6,856 12th
graders (Jump$tart Coalition for Personal Financial Literacy, 2008)

•The majority of high school students were unable to
answer basic financial questions regarding credit, savings,
interest, and insurance.
    – Correctly answered 48.3% of the questions
    – Lowest score since 1997
    – Highest score ever was 57% - still considered failing - in
      1997
Financial Literacy – or Illiteracy Statistics



• College students’ survey administered to 1,030 full-time
  students (Jump$tart Coalition for Personal Financial Literacy, 2008)

    – Correctly answered 62% of the questions
    – College freshman correctly answered 59% of the
      questions
    – College seniors correctly answered 65% of the
      questions
Sample survey question – Jump$tart Coalition

 Sara and Josh just had a baby. They received money as
 baby gifts and want to put it away for the baby’s education.
 Which of the following tends to have the highest growth over
 periods of time as long as 18 years?

 A)A checking account
 B)Stocks
 C)A U.S. Government savings bond
 D)A savings account

 B. Only 16.8% of high school students and 19.2% of college
 students feel stocks are likely to have a higher return than all other
 choices…over an 18 year period.
Sample survey question – Jump$tart Coalition
Many young people receive health insurance benefits
through their parents. Which of the following statements is
true about health insurance coverage?

A)You are covered by your parents’ plan until you marry
B)If your parents become unemployed, your insurance
coverage may stop
C)Young people don’t need insurance b/c they are healthy
D)You continue to be covered by your parents’ plan as long
as you live at home, no matter your age

B. Only about 40% of high school students got it right. What’s
scarier is that 33% answered “D”. 70% of college students
answered correctly.
2012 Financial Literacy Statistics – North Carolina
Financial Literacy Statistics – Postsecondary



• The top five stressors for currently enrolled college
  students are:
  - the need to repay loans
  - the cost of education
  - borrowing money for college
  - the need to find a job after school
  - the academic challenge of course work
       • (Inceptia - Financial Stress: An Everyday Reality for College
         Students 2012)
More Statistics...


• 1st year students more stressed than the average college
  student when it came to Cost of Education and Cost of
  Living

• Overall, one third (34 percent) of respondents said
  financial stressors have had a negative impact on their
  academic performance or progress

• Another 20 percent report they have had to reduce their
  course load due to these same stressors
      • (Inceptia - Financial Stress: An Everyday Reality for College
        Students 2012)
Financial Literacy Resources And Tools



•   NEFE Tools
•   America’s Promise Alliance
•   Federal Government Resources
•   Mapping Your Future Tools
•   Cash Course
•   Other Resources
•   Get Financially Fit!
•   CFNC Resources
National Endowment for Financial Education (NEFE)



• Educate high school students about money management
  and financial planning
• Help teens develop positive behaviors
• Curriculum materials
• Sponsors Include
   –   Cooperative State Research, Education & Extension Service
   –   USDA
   –   Credit Union National Association, Inc.
   –   America’s Credit Unions
• Nefe.org
America’s Promise Alliance



• Teach middle school and high school students about
  financial responsibility
• Set of curriculum materials
• Founded in 1997
   – General Colin Powell is the Chairman
   – Partnership of over 400 organizations
• Americaspromise.org
Federal Government Resources



• U. S. Treasury
   – National Financial Capability Challenge (annual)
   – Educator’s Toolkit
• mymoney.gov
Mapping Your Future



• Budget Tools
• Calculators
• Show Me the Future Game
  - geared for younger students
• Entrance and Exit Counseling
• Mappingyourfuture.org
Cash Course



• Financial education resources for colleges
• Sponsored by NEFE
• Cashcourse.org
Other Financial Literacy Resources



•   practicalmoneyskills.com
•   financiallit.org
•   nslp.org
•   tgslc.org
•   usafunds.org
•   mygreatlakes.org
Get Financially Fit!


• “How-to” Financial Education Toolkit – to develop a
  financial literacy program on college campuses
• newyorkfed.org/regional/projects.html
• Funding for this project provided by:
   –   American Council on Consumer Interests
   –   Federal Reserve Bank of New York
   –   Association for Financial Counseling and Planning Education
   –   Direct Selling Education Foundation
Did You Know…


•Americans are more in debt today than any other time in
history
•Average college graduate has nearly $25,000 in student loan
debt
•The average student graduates with a credit card debt of
around $4,000
•1 in 3 students graduate with $10,000 or more in credit card
debt
Top 5 things HS Students spend their money on
How did you do?
If you chose mostly:

oA answers –
   You put off making money decisions.

oB answers –
   You like to see your money make money.

oC answers –
   You enjoy spending and think little about how to pay for
   your purchases
How did you do?



o D answers –
  You care about others who have less than you do, and
  you often feel guilty about having more than they do.

o E answers –
  You like to save every penny. You do not enjoy spending
  money.
Financial Literacy Education Components



•   What is financial health?
•   Budget tools
•   Calculators – savings, credit card debt, loan repayment
•   Using credit responsibly
•   Borrowing to finance an education
•   Setting financial goals
•   Information about financial institutions, identity theft, etc.
•   Assessment tool
An Example: CFNC.org Financial Literacy Tools
Financial Literacy Scholarship – Decision Partners

A $500 scholarship awarded randomly to two students per
year who complete the Financial Literacy 101 or AMM
course at CFNC.org.

Eligibility Requirements:
•Contest begins on July 1st of each year
•Deadline is June 30th of each year
•Be a NC resident
•Be accepted for enrollment or currently be a student at
accredited college or university
•Complete FL 101 or AMM course at CFNC.org with a 80% or
higher score
Financial Literacy – Elementary Students



• Videos
   – Goals
   – Money Grows
   – Spend or Save
Financial Literacy



• Online, interactive course
• Multi-media or text
• Tools to help you make wise money management
  decisions
• Calculators
• Fact sheets
Financial Literacy 101 and AMM Course Topics
Building Blocks Of Financial Health
 Budgeting 101

• Identify income
• Identify expenses
• Remember the different types of expenses
   – Fixed
   – Variable
   – Periodic
• Pay Yourself First!
   – Funds transfer to a savings account
   – Payroll deduction
   – Internet transfer
   – Envelope method
Budget Calculation Tool
Real World Calculator
Credit Cards - The Good, The Bad, And The Ugly



• When it is appropriate to use credit (for example, an
  emergency)
• What happens if you only make the minimum payment or
  run up the balance
• What happens if you fail to make payments
• Credit Card Calculator
Credit Report Basics



• Know what’s on your credit report!
• You should check it at least ONCE per year!
• What creditors are looking for:
  -On time payments
  -Your mortgage payments
  -Available credit on your credit cards
  -Total debt outstanding
• Missing even one credit card payment can knock your
  score down 50-100 points.
Credit Card Repayment Calculator
Investing in Your Education
Education Loan Repayment Calculator
Smart Borrower Calculator
Set Your Financial Goals




                  Write your goals down!
Additional Resources - Text
Assessment



• Online quiz
• Questions asked after certain topics
• Certificate of completion
Additional Resources - Fact Sheets
Financial Literacy Games on CFNC.org
Financial Aid Administrator Access – Master Control
Panel Homepage
View Student-Level Detail




•   Student name
•   Login date
•   Year in school
•   Percent of material covered
•   Percent of correct answers
•   Completion code
Financial Literacy Reports




•   Pre-Course Survey
•   Post-Course Survey
•   Quiz Reports
•   Export Usage Data
On Your Campus



• Consider using a combination of several programs
   – Some students respond best “in person”
   – Some prefer working at their own pace on-line
• Integrate financial literacy education into your debt
  management plan
• Your current financial literacy education activities?
• Your future financial literacy education plans?
      Questions About CFNC Services and Tools

Area Code        Name              Email              Phone


252              Amy Denton        adenton@cfi.org    252-402-6157


910              April Morey       amorey@cfi.org     910-280-1883


919              Sarita Broadway   sbroadwa@cfi.org   919-264-3686


336              Takeila Hall      thall@cfi.org      336-402-5622


704/980          Timeka Ruffin     truffin@cfi.org    704-281-3437


828 West         Laura Misner      lmisner@cfi.org    828-712-9840


828 East         Skip Watts        swatts@cfi.org     828-337-7939
Questions?

								
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