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Financial Literacy Education for Graduate Students

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Financial Literacy Education for Graduate Students: How to implement a comprehensive program on your campus Kimberly A. Brown, M.Ed. Midwestern University – PowerPoint PPT presentation

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Title: Financial Literacy Education for Graduate Students


1
  • Financial Literacy Education for Graduate
    Students
  • How to implement a comprehensive program on your
    campus
  • Kimberly A. Brown, M.Ed.
  • Midwestern University

2
Midwestern University
  • Private, not-for-profit
  • School-as-lender
  • Downers Grove, IL 1989 students
  • Glendale, AZ 1471 students
  • Osteopathic Medicine, Pharmacy, Podiatry, PA, PT,
    OT, BMS, PsyD, CRNA, Cardiovascular science,
    Dental in 08
  • Each campus has 9 staff
  • Director, Assist. Director, 4 FAAs, 2 clerks,
    and one departmental assistant

3
Financial Literacy Initiatives
  • Student loan indebtedness-medical
  • June 2005 graduates avg. 166,477
  • June 2006 graduates avg. 169,294
  • June 2007 graduates avg. 174,659

4
Financial Literacy Initiatives
  • Student loan indebtednessmedical 2007
  • 295/313 (94) medical grads borrowed
  • 54 of borrowers had debt in excess of
    175,000
  • 175,000-199,999 43 graduates
  • 200,000-224,299 43 graduates
  • 225,000-249,999 71 graduates
  • 250,000 11 graduates
  • In 2006, 57 had excess of 175,000
  • In 2005, 54 had excess of 175,000

5
Financial Literacy Initiatives
6
Financial Literacy Initiatives
  • Comprehensive program from pre-
  • matriculation through graduation and beyond
  • USA Funds Life Skills
  • Flexible educational program to teach students to
    be better consumers of higher education by
    teaching them basic strategies to manage their
    finances, time, and relationships.

7
Financial Literacy Initiatives
  • M1 Get a grip on your finances Smart spending
    for students.
  • M2 Seek out financial aid Funding sources and
    financial obligations.
  • M3 Work hard but smart How to be successful
    in school and graduate on time.
  • M4 Take control of your future Finishing school
    and repaying your loans.
  • M5 Now that you are about to graduate Take
    control of your life.

8
Research revealed
  • Graduates are similar to undergraduates. Both
    student groups
  • Borrow a lot of money.
  • Have problems managing their money.
  • Are more preoccupied with academic (or social)
    life than with their finances.
  • Would benefit from more information and
    counseling on the basics of financial management,
    borrowing and repayment.
  • Even so, they are more sophisticated about
    managing money and living with debt. They also
    accumulate substantially more debt over time.

9
Research literature revealed
  • Graduate and professional student enrollment is
    growing and so is their debt.
  • 2.7 million students enrolled in graduate and
    first-professional programs.
  • Master's programs 58
  • First-professional 12
  • Doctoral 13
  • Other 16

10
Research literature revealed
  • 60 rely on financial aid (even more for
    full-time students 83).
  • 73 of education M.A. and M.B.A. students attend
    school part time, work full time.
  • 80 of first-professionals attend school full
    time, do not work.
  • 43.2 of all graduate/professional students are
    married.
  • 33.9 have dependent children.

Area of Study Married Dependents
Law 24 17
Medicine 22 15
Health Science 22 16
Education 63 54
Business 48 37
11
Other relevant research indicated
  • Graduate school can have a detrimental effect on
    marriages and relationships (Houseknecht et al.,
    1984 King, 1997 Legako et al., 2000 McRoy
    Fisher, 1982 Scheinkman, 1988).
  • Juggling family and student roles (Gruver
    Labadie, 1975 Hollahan, 1979).
  • Gender role conflicts (Guldner, 1978
    Houseknecht et al., 1984 Pearlin Turner, 1987
    Sori et al., 1996).
  • Financial burdens and relocation (Scheinkman,
    1988).
  • Changes in schedules, recreation and social life
    (Scheinkman,1988).
  • Emotional contagion effects that crossover from
    school to marriage (Katz Beach, 2000 Rook et
    al., 1991).
  • Spouses educational hypogamy (Houseknecht et
    al.,1984 Sokolski,1996).
  • Presence of children seems to be a negative
    factor for married graduate students (Gilbert,
    1982 Houseknecht et al., 1984 McLaughlin,
    1985).
  • Students/partners have too little emotional
    energy or time to deal with emerging relational
    issues (Guldner, 1978 Guy, 1987).

12
Why would graduate/professional students want
Life Skills?
  • Students realize that they face a whole new set
    of challenges when they enter into advanced
    study.
  • It's more work.
  • It costs them a lot of money.
  • Chances of program completion are only about
    50/50 (Peters, 1997).
  • Investing in Life Skills will help them face
    these challenges and make their efforts (and
    money) count.

13
USA Funds Life Skills
  • Module 6 - Embrace New Academic Challenges
    Drafting Your Professional Plan.
  • Designed to teach students how to determine their
    financial needs, assess the return on their
    investment in further education, adjust to the
    graduate/professional experience and define their
    program of study.

14
USA Funds Life Skills
  • Module 7 - Connect as a Couple Confronting
    Relationship Challenges Together.
  • Designed primarily for couples, this module will
    help partners adjust to their new roles and tasks
    while in school, negotiate time for each other,
    anticipate and manage their financial challenges
    as a couple and engage in decision-making
    together.

15
USA Funds Life Skills
  • Module 8 - Take Stock Devising a Realistic
    Financial Plan.
  • Designed to help students make a budget, live
    within their means, set their own debt limits and
    manage their student loans.

16
USA Funds Life Skills
  • Module 9 - Live Like a Student Managing Your
    Funds.
  • Designed to help students obtain financial
    support for their education, locate alternative
    sources of funding, stretch their resources and
    make every dollar count.

17
USA Funds Life Skills
  • MM1 - Reentering School How Do I Adjust My
    Standard of Living?
  • MM2 - How Do I Survive During My Residency?
  • MM3 - Couple Talk How Do We Talk About Money
    Without Fighting?

18
Financial Literacy Initiatives The Participants
  • National Debt Management Director, USA Funds
  • Director, Student Financial Services
  • Director, Admissions
  • Campus Counselor
  • Assistant Director, SFS
  • Financial Aid Administrators
  • Student Financial Services Assistant

19
Assessing our audience
  • Generally, what are
  • the characteristics of
  • applicants to MWU?
  • What are their needs?
  • What is their state of
  • mind on the interview
  • day?

20
Assessing challenges in reaching our audience
  • Given these characteristics, what challenges do
    you face in getting them to focus on issues of
    debt management and financial literacy?

21
The general plan
  • Medical School Applicants
  • October through April, 50 60 interview days, 8
    12, two groups of six, 30 minutes with each
    group.
  • Pharmacy Applicants
  • October through April, 12 sessions, groups of 40
    50, 30 minutes with each group.

22
The general plan
  • PA Applicants
  • Same as Pharmacy.
  • Other Health Sciences Applicants
  • PT, OT, Bio-med.
  • Small group, one-on-one, 10 minutes.

23
The general plan
  • Two financial aid staff are assigned to each
    session.
  • Presenter Responsible for presenting entire
    session.
  • Observer
  • Responsible for all logistics, ensuring equipment
    setup, materials distribution, assisting
    presenter as needed. Providing moral support and
    appropriate feedback to the presenter. Gathering
    evaluation forms. Keeping their presentation
    sharp in their mind by observing others, and
    gaining possible ideas of items to add to their
    own presentation.

24
What is in Module 6? A page by page review and
demo of CDs
25
Identification of objectives
  • To educate applicants
  • Cost of attendance determining financial needs.
  • Sources of aid available.
  • Financial aid application process.
  • Process flowchart.
  • School-as-lender.
  • Adjust to the graduate/professional school
    experience.
  • Assess their return on investment.
  • Showing a real life story video clip.
  • Additional resources.

26
Identification of objectives
  • To sell the reasons MWU is positively unique in
    comparison to other institutions.
  • School as lender model.
  • 0 origination fees.
  • Entirely online process.
  • User-friendly.
  • One on one counseling.
  • Open door policy Our job is to help you.
  • Friendly, warm, supportive environment.

27
Identification of objectives
  • To engage the audience by using active training
    techniques.
  • To present in a friendly, warm, positive manner
    to relax the applicants.
  • To congratulate them on their successes and
    acknowledge their hard work to date.
  • To encourage them to look to their dreams for the
    future and set long term goals.

28
Designing of the session
  • The task design the 30 minute session outlined.
  • What material will you cover?
  • What activities will you use?
  • How will you overcome the challenges you
    identified?

29
Engaging the applicants
  • The best way to pre-empt problems and challenges
    is to be well-prepared to teach.
  • Preparation prevention.
  • Preventative measures
  • Set up a positive, safe, and supportive learning
    environment.
  • Learn and use applicants names.
  • Take a few minutes to personalize your
    instruction.
  • Reinforce applicants when they make positive
    contributions.

30
Engaging the applicants
  • Determine how much time you have to teach the
    module.
  • Dont feel you must teach everything in the
    module.
  • Prioritize what you decide to teach.
  • Encourage active applicant involvement.

31
Engaging the applicants
  • Provide facili-tainment.
  • Ask questions.
  • Ask open-ended questions.
  • Once youve asked a question, wait.
  • Direct questions to particular applicants.
  • Ask why or how questions.
  • Probe for consequences or implications.
  • Ask applicants to share their feelings.
  • Ask applicants to indicate what they gained or
    lost from their experiences.

32
Engaging the applicants
  • Speak with authority. Stay in control.
  • Use oral footnotes.
  • Admit when you dont know.
  • Respect and listen to your applicants.
  • Make every effort to remain positive and show
    that you care about them.

33
Review
  • Review the plan to see if any changes are needed.
  • Review of applicants state of mind.
  • Review of challenges.
  • Review of objectives.

34
The Stars of MWU present the session
Positive feedback and suggestions were given by
the group on content, presentation skills and
non-verbal presentation behaviors. The best
advice was to know your material and you will be
successful!
35
Further practice sessions
  • Within the next week after our training
  • Staff practiced together for two half days in a
    classroom.
  • Staff each presented their session to entire
    department and myself.
  • The next day staff each presented to the CFO,
    Admissions, Counselor, and myself.
  • Finally, they were able to practice in the room
    they would present in just one day before the
    session.

36
Challenges to Implementation
  • Rooms
  • Layout
  • Noise
  • Changing rooms
  • Security
  • Technical difficulties
  • Sound card and Speakers
  • IT staff

37
Admissions Interview Days
  • Embrace New Academic ChallengesDrafting your
    professional plan
  • Reentering schoolHow do I adjust my standard of
    living
  • Types of aid and how to apply
  • Living within your means
  • Return on investment/expected salaries
  • Strategies to reduce personal expenses

38
Admissions Interview Days
  • 10 staff trained to present
  • 5-15 sessions per week
  • 2004-2005 recruiting cycle-213 sessions conducted
    with 2615 applicants
  • 2005-2006 recruiting cycle-244 sessions conducted
    with 2765 applicants
  • 2006-2007 recruiting cycle- 187 sessions
    conducted with 1459 applicants

39
Financial Literacy Initiatives
  • Orientation Entrance Interview
  • Department Overview
  • Cost of Attendance
  • Types of Title IV Aid
  • Repayment/ Deferment/ Consolidation
  • Default
  • Accounts Receivable and Billing
  • Taking Care of Businessone on one opportunity
    to meet with a financial aid administrator

40
Financial Literacy Initiatives
  • Connect as a CoupleConfronting relationship
    challenges together
  • Co-hosted by Student Services
  • Formal and informal sessions
  • Students come with significant others
  • Sacrifices families will experience
  • How to find time for each other
  • Financial adjustments
  • How to talk about money without arguing

41
Financial Literacy Initiatives
  • Take StockDevising a realistic financial plan
  • Core Course Session-mandatory first year
  • Live within your means
  • Set your own debt limits-credit cards, student
    loans managing the debt
  • Understand costs of education
  • Maintain good FICO score
  • Consolidation and repayment

42
Financial Literacy Initiatives
  • Embrace financial challenges-drafting a plan for
    success a luncheon sponsored by SOMA
  • What are the annual and aggregate limits on
    student loans?
  • What will be my total anticipated indebtedness?
  • What is my return on investment?
  • What is consolidation and when can I do it?
  • What repayment options are available to me?
  • Guest alumni speakers

43
Financial Literacy Initiatives
  • Rotation orientation for all programstime made
    available by Deans offices
  • How do I survive during my residency
  • Indebtedness to date
  • Minimize borrowing
  • Financing remaining education
  • Repayment options Consolidation
  • Overcoming stress
  • Healthy behavior strategies
  • Finding a mentor

44
Financial Literacy Initiatives
  • Graduation Exit Interviews-all borrowers
  • Mandatory session
  • AACOM indebtedness survey
  • Personalized indebtedness sheets
  • Repayment options, comparison charts
  • Economic Hardship Deferments
  • Mandatory Internship/Residency Forbearances
  • Loan Consolidation

45
Financial Literacy Initiatives
  • We have an open door policy to offer one on one
    counseling.
  • Financial aid programs and eligibility
  • Indebtedness levels
  • Total cost of attendance
  • Budgeting your money payment plans
  • Adjusting your financial habits while in school
  • Repayment options Loan consolidation
  • FICO (credit) scores
  • Return on investment calculations

46
Results
  • Cohort default rate has decreased each year for
    the past five years to our current rate of 0.
  • Indebtedness levels are not increasing
    incrementally to match increases in cost of
    tuition and total cost of attendance.
  • Students are actually returning excess loan funds
    after attending our sessions.

47
Results
  • Satisfaction survey results on usefulness of
  • content, knowledge/skill of trainer,
  • enjoyment/value of activities, based on a 7 point
  • scale
  • 2005
  • 843 surveyed 5.22 6.25
  • 2006
  • 1178 surveyed 5.30 6.24
  • 2007
  • 1124 surveyed 5.48 -- 6.35

48
Results
  • Midwestern University was selected as a model
    institution for our implementation of the USA
    Funds Life Skills program.
  • USA Funds visited the IL campus to produce a
    testimonial video and print ads for higher
    education publications.
  • MWU won the 2006 Excellence in Debt Management
    Award from USA Funds.

49
Incorporating external speakers
  • Spouses of faculty, staff, or students who are
    CPAs
  • Residents to talk to seniors about contracts
  • Alumni to talk about repayment
  • Military to talk about full scholarships
  • Association of American Medical Colleges
  • Real estate agencies
  • Financial planners
  • Insurance agencies

50
References
  • Complete reference list along with additional
    resources and readings are available in USA Funds
    Life Skills Connect as a CoupleConfronting
    relationship challenges together. Module 7

51
  • Questions?
  • Kim Brown
  • kbrown_at_midwestern.edu
  • 630-515-6044
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