Personal Finance Instruction at U.S. Colleges and Universities

by Kimberly Blanton

During the financial boom several years ago, mortgages weren’t the only form of money that coursed through the nation’s financial system. Student loans were plentiful – and easy to get. College students reported that money appeared – almost like magic – in their bank accounts, minutes after they completed a financial company’s “easy online loan application.” Rising tuitions have continued to propel borrowing in recent years.

Student debt in the United States now approaches $1 trillion – exceeding Americans’ credit-card balances for the first time – and 59 percent of U.S. undergraduates are in debt, according to FinAid.org. These loans have often had painful consequences for millions of graduates who entered the workforce in recent years. Debt has made it difficult to buy a home or save for retirement.

But universities have begun taking the initiative to educate their students about their personal financial decisions. For some institutions and individual instructors, it has become a mission. This report, based on interviews with more than three dozen educators, textbook publishers, researchers, personal finance organizations, and business schools, examines universities’ attempts to educate their general student populations to be more financially savvy.

No central database exists that tracks institutions offering personal finance courses for students’ benefit, rather than as a routine part of a business school curriculum. The Financial Security Project at Boston College identified more than 100 U.S. colleges and universities that offer for-credit courses in personal finance, many of them adopted them during the past six to eight years. Despite this promising trend, there is still an enormous need for college personal finance education, which currently reaches a small share of the total student population.

3 Responses to Personal Finance Instruction at U.S. Colleges and Universities

  1. Miggy says:

    Student loans can haunt a person’s financial records long after the graduation. The U.S. government really needs to educate students at handling their finances better. It should also provide for discussion on how to deal with debt.

  2. Jay Gould says:

    Student loans are well on their way to overtaking credit card debt. Americans are now paying down their credit card debt at a much slower pace than during the months immediately following the Lehman collapse in September 2008, but they continue to do so all the same. Additionally, the delinquency rate on U.S. credit cards – 3.04% in September, according to Moody’s, is at a record low.

    Falling delinquencies have led to lower defaults, which will keep falling for months ahead, even as the late payment curve may have bottomed out already.

    Moreover, the monthly payment rate (MPR), which measures the ratio of their credit card debt Americans are paying back at the end of each monthly cycle, was at 21.29% in September, compared to a historical average in the mid-teens.

    If that is the new normal, it will ensure that low delinquencies and defaults are also here to stay. Of course, there is also the possibility that, once we get back to full employment and consumer confidence improves, everyone will fall back into their free spending pre-Lehman pattern. Unfortunately, we are unlikely to be able to test our propositions anytime soon. http://blog.unibulmerchantservices.com/americans-slash-credit-card-debt-to-lowest-level-in-more-than-7-years

  3. F. MacPhee says:

    The information provided here is easy to understand and gives practical advice to those who find themselves in financial difficulty. Many people get so overwhelmed by their situation that they can’t get organized enough to plan for a way out of debt. It is sites like these that play an integral role in getting these people, and this nation, back on track.