College-Based Personal Finance Education: Student Interest in Three Delivery Methods
Goetz, Joseph, Cude, Brenda J., Nielsen, Robert B., Chatterjee, Swarn, Mimura, Yoko, Journal of Financial Counseling and Planning
Using online survey responses from 509 undergraduate students, three financial education methods (on-campus financial counseling center, online financial management resources, and in-person educational workshops) were examined. Using a social constructionist framework, the analysis controlled for various demographic and financial factors. The results of three logistic regressions indicated that having taken a personal finance course was positively associated with interest in all three delivery methods. Having higher debt, being African American, and believing that finances will affect college completion were positively associated with at least one but not all three delivery methods. Recommendations for implementing financial education programming for college students are provided.
Key Words: college students, financial education, financial literacy
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College students face high tuition costs and increasingly complex financial decisions. As Lusardi (2010) notes, choosing when and how to invest in education is in and of itself an extremely complicated decision. One half of all freshmen borrow to pay for their educations and in the process make decisions that will affect their financial futures in ways they likely do not yet understand (Gladieux & Perna, 2005). Without exposure to financial education or counseling, many students find the variables involved in making accurate financial decisions abstruse or inaccessible (Adams & Moore, 2007; Avard, Manton, English, & Walker, 2005; Chen & Volpe, 1998). This lack of financial knowledge and difficulty in making good financial decisions is evident even after young adults graduate and move into the workforce (Volpe, Chen, & Liu, 2006). Financialrelated stress, which has become increasingly common among students (Phinney & Haas, 2003), can lead to poor academic performance and productivity (Pinto, Parente, & Palmer, 2001; Ross, Niebling, & Heckert, 1999; St. John, 1998) and even leaving college to work additional hours to manage debts (Roberts & Jones, 2001; U.S. General Accountability Office, 2001). Each of these outcomes adversely affects retention rates at colleges and universities and hinders students' career potential.
College students face decisions that are likely to be new to them in a new environment but without direct parental support and supervision. Researchers (Chen & Volpe, 1998; Jump$tart Coalition for Personal Financial Literacy, 2008) have demonstrated that college students, like many subpopulations, have inadequate financial management knowledge. Anecdotal evidence of the long-term consequences of their choices, such as NFL quarterback Drew Brees' citing the effect an unpaid cell phone bill during college had on his first mortgage's interest rate (Alderman, 2010), rings true for professionals who work with the college student population.
The Credit Card Accountability Responsibility and Disclosure Act of 2009 includes provisions designed to limit credit card marketing to college students. However, inevitably college students still will have credit cards even after implementation of the law. As is true today, many will find their income and the amount of credit available to them to be poorly matched, creating a problem especially for students predisposed to overspending or those who lack other financial resources to pay credit card balances (Chen & Volpe, 1998). Students' financial decisions are further complicated by various unforeseeable expenses and the difficulty of projecting future income levels. Students who graduate with low credit scores face barriers in finding employment, because prospective employers for positions with fiduciary or financial responsibilities frequently check applicants' credit reports. Furthermore, students' credit histories affect their ability to rent an apartment and qualify for an auto or home loan as well as the insurance premiums and interest rates they pay (Insurance Information Institute, 2009). …