Financial LiteracyAshley Ann Reich

VASFAA 2013 Annual Conference Tuesday, May 14, 2013

CDR Figures Nationwide

EARLY STAGES OF ENROLLMENT

LATE STAGES OF ENROLLMENT

EARLY STAGES OF DELINQUENCY

LATE STAGES OF DELINQUENCY

60

70

90

120

150

180

LETTERS FOR GRADUATES

LETTERS FOR STOP OUTS

HARDSHIP OPTIONS

Forbearance

IBR

ANNUAL LOAN UPDATE (est. only- go to official sources) All loans Sample Repayments Projection Effect of working vs. borrowing Effect of interest only payments while in school Options / Budgeting *Modern credit card look

EC TRIGGERS loans Enhance(d) disbursement letters Awareness campaign Financial Literacy webpage A card to hand out Refrigerator magnet Bulk(y) mailings

FINDING BORROWERS (LATE & FRAUD)

Skip Tracing References Communications Parent e-mails ID Procedure

PROACTIVE MEASURES Deferment Review Improve Exit Counseling Degree conferral requirement

FURTHER MEASURES Incentivized engagement Listen to our iTunes presentation, win… Call campaigns

“OK- ENOUGH’S ENOUGH!” MEASURES

Call campaigns Nasty grams Very nasty grams

PROFESSIONAL PIECE AGGREGATE DATA

BORROWING vs. FUTURE CAREER PLANS PREVIOUS DISCHARGE DATA

MAJORS DATA (academic/ degree field--affects picture)

Hardship deferral

Delinquency: letters sent to students at the 60 day point Servicer Information: created a “How to Locate Servicer” step-by-step

page for students

Step-by-Step Directions Locating a Loan Servicer 1) Please visit: www.nslds.ed.gov 2) Select “Financial Aid Review” 3) Select “Accept” after you have read and understood the information presented on the screen 4) Enter your Social Security Number, first two letters of last name, Date of Birth and Federal PIN Number to log-in 5) Under the Loans and the “Type of Loan” category, please click on each number in the first column to view details

Communication

According to Wikipedia, “Financial literacy is the ability to understand how money works in the world: how someone manages to earn or make it, how that person manages it, how he/she invests it (turn it into more) and how that person donates it to help others. More specifically, it refers to the set of skills and knowledge that allows an individual to make informed and effective decisions with all of their financial resources.”

What is Financial Literacy?

The Consumer Financial Protection Bureau (CFPB) was tasked with financial literacy education among various other mandates in July of 2010.

Many schools, organizations, lenders, etc. saw the importance of providing financial education to students, teens, and the community in order to develop more financially-responsible citizens.

There are hundreds of options available for financial literacy programs and they are growing by the day.

Financial Literacy Background

On February 1, 2013, an article was released on HLN regarding NFL stars that were promoting financial literacy among youth in the form of a video game (Thomas, 2013).

The Council for Economic Education has implemented a dollar-for-dollar match towards contributions made up to $175,000 in order to provide education to teachers and students on financial literacy (Lrasimas, 2013).

Forbes released an article discussing the importance of financial literacy and explained how at least 13 states require some sort of financial education as a high school graduation requirement (Scott, 2013).

Examples of Financial Literacy in the News

Assess the situation Number of students Population

Consider the time Implementation Maintenance

Consider the cost Purchase materials Pay staff members Purchase a product Many free options

available

Where Do I Begin?

Paying for college with more than student loans

Banking Savings Investing College Skills Interviewing/Resume Skills

What Information Should We Teach?

Lower the National Debt-student loan debt has far-surpassed credit card debt and is rising by the day

Financial Literacy is one of the most talked about topics in NASFAA News and other educational articles that come out daily and is a “hot topic”

Lower a school’s CDR Creating fiscally-responsible citizens of the

United States

Why Do We Care About Financial Literacy?

Lender Products TG (Adventures in Education-

AIE and Integrated Default Assistance-IDA)

Great Lakes (Financial IQ) Sallie Mae (Managing Your

Money) ECMC (Financial Awareness

Basics and Interactive Tools)

Bank Products 5/3rd Bank in conjunction

with Dave Ramsey Federal Reserve Bank

Etc.

Other Products EverFi (Buttonwood/Transit

Financial Wellness) Dave Ramsey (Foundations in

Personal Finance College Edition)

Department of Education Financial Awareness Counseling

Mymoney.gov Etc.

What Products are Available?

Financial literacy is an up-hill battle and you need to get buy-in from upper administration in order to make progress in this area

As CDR increases, upper administration will begin to pay attention

Make a point to provide facts and numbers to upper administration in meetings and various off-handed discussions

They want to see the “why” and “how”

How To Get Buy-In

I don’t have enough staff We are on budget restrictions I don’t have the time to meet with students

face-to-face or to implement the program My administration does not care about

financial literacy Our CDR is very low so we don’t need

financial literacy

Common Myths

Liberty University implemented a financial literacy program in June 2012 utilizing the Buttonwood product by EverFi

Over 2,000 students have gone through the various modules in Buttonwood and we have seen great success

In June 2013, we plan to utilize Dave Ramsey’s Foundations materials in the form of a class for a select group of students

Population Selected: Defaulted and Close, At, or Over Aggregate Limits; product will be available for all students, if interested

Liberty University’s Financial Literacy Plan

What programs are you wanting to implement? What programs have already been

implemented? What products are you using? Are there

multiple being used or just one? What issues are you dealing with at your school

in regards to financial literacy? What is working well in regards to financial

literacy? What is not? What student populations are you selecting? Is

it all-encompassing or a certain group?

Discussion

Questions?Please feel free to email me at aareich@liberty.edu

Thomas, A. (2013, February 1). Retrieved from http://www.hlntv.com/article/2013/02/01/super-bowl-financial-football-game-nfl-visa on May 2, 2013.

Scott, R. (2013, March 12). Retrieved from http://www.forbes.com/sites/causeintegration/2013/03/12/priceless-volunteers-bring-financial-literacy-to-the-masses/ on May 2, 2013.

Lrasimas (2013, May 1). Retrieved from http://www.councilforeconed.org/2013/05/01/cees-175000-matching-challenge-grant-through-june-30/ on May 2, 2013.

References