Financial literacy key to retention and default prevention fall 2012 ncasfaa conference
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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

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Financial literacy key to retention and default prevention fall 2012 ncasfaa conference

Financial Literacy: Key to Retention and Default PreventionFall 2012NCASFAA Conference


What is financial literacy why is it important

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

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 statistics1

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

    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 checking account

    Stocks

    A U.S. Government savings bond

    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 coalition1

    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?

    You are covered by your parents’ plan until you marry

    If your parents become unemployed, your insurance coverage may stop

    Young people don’t need insurance b/c they are healthy

    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

    2012 Financial Literacy Statistics – North Carolina


    Financial literacy statistics postsecondary

    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

    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

    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

    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

    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

    Federal Government Resources

    • U. S. Treasury

      • National Financial Capability Challenge (annual)

      • Educator’s Toolkit

    • mymoney.gov


    Mapping your future

    Mapping Your Future

    • Budget Tools

    • Calculators

    • Show Me the Future Game

      - geared for younger students

    • Entrance and Exit Counseling

    • Mappingyourfuture.org


    Cash course

    Cash Course

    Financial education resources for colleges

    Sponsored by NEFE

    Cashcourse.org


    Other financial literacy resources

    Other Financial Literacy Resources

    • practicalmoneyskills.com

    • financiallit.org

    • nslp.org

    • tgslc.org

    • usafunds.org

    • mygreatlakes.org


    Get financially fit

    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

    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

    Top 5 things HS Students spend their money on


    How did you do

    How did you do?

    If you chose mostly:

    • A answers –

      You put off making money decisions.

    • B answers –

      You like to see your money make money.

    • C answers –

      You enjoy spending and think little about how to pay for your purchases


    How did you do1

    How did you do?

    • D answers –

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

    • E answers –

      You like to save every penny. You do not enjoy spending money.


    Financial literacy education components

    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

    An Example: CFNC.org Financial Literacy Tools


    Financial literacy scholarship decision partners

    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

    Financial Literacy – Elementary Students

    Videos

    Goals

    Money Grows

    Spend or Save


    Financial literacy

    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

    Financial Literacy 101 and AMM Course Topics


    Building blocks of financial health

    Building Blocks Of Financial Health


    Budgeting 101

    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

    Budget Calculation Tool


    Real world calculator

    Real World Calculator


    Credit cards the good the bad and the ugly

    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

    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

    Credit Card Repayment Calculator


    Investing in your education

    Investing in Your Education


    Education loan repayment calculator

    Education Loan Repayment Calculator


    Smart borrower calculator

    Smart Borrower Calculator


    Set your financial goals

    Set Your Financial Goals

    Write your goals down!


    Additional resources text

    Additional Resources - Text


    Assessment

    Assessment

    Online quiz

    Questions asked after certain topics

    Certificate of completion


    Additional resources fact sheets

    Additional Resources - Fact Sheets


    Financial literacy games on cfnc org

    Financial Literacy Games on CFNC.org


    Financial aid administrator access master control panel homepage

    Financial Aid Administrator Access – Master Control Panel Homepage


    View student level detail

    View Student-Level Detail

    Student name

    Login date

    Year in school

    Percent of material covered

    Percent of correct answers

    Completion code


    Financial literacy reports

    Financial Literacy Reports

    • Pre-Course Survey

    • Post-Course Survey

    • Quiz Reports

    • Export Usage Data


    On your campus

    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

    Questions About CFNC Services and Tools


    Questions

    Questions?


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