How 4 colleges are helping students manage their finances better

Colleges are exploring new ways to teach financial literacy to students, Jillian Berman reports for the Wall Street Journal.

According to a recent study by U.S. Bank, college students are showing increased interest in learning more about personal finance and financial well-being. Community college students are also interested in more information about finances, according to a survey by Center for Community College Student Engagement.  Nearly half of respondents said financial problems could cause them to leave school, and 91% said they want more information about financial assistance.

Berman rounds up what four colleges are doing to better teach financial literacy to students.

Indiana University (IU) has focused on reducing the amount students borrow to finance their education. Since 2012, the university has sent annual updates to students about their student loans, including an estimate of their monthly payment after graduation. Since then, students have reduced their borrowing by 17% and have increased their engagement with the financial aid office on campus, Schuman reports.

IU also recently launched an online calculator that walks students through important financial decisions, such as choosing between housing options.

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The University of Minnesota (UMN) also encourages students to borrow less. UMN sends a debt letter similar to IU's and tells students each year whether they are on pace to graduate on time. The institution spells out  the cost of taking an extra year of college in real-world terms, such as a down payment on a car or home, according to Julie Selander, director of the institution's One Stop Student Services center. 

Some colleges focus on helping students make smarter financial decisions in the day-to-day. The University of Missouri noticed that financial difficulties prevented many students from graduating—but students were also incurring significant past-due bills for non-academic expenses. Officials decided to limit use of the student ID to expenses related to school only.

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Finally, other colleges are offering training to students who show signs of needing extra help. When students miss a payment at Ohio State University (OSU), officials offer to waive the late fee if the students attend financial counseling sessions. "We're not in the business of assessing late fees, we're in the business of educating students," says Tony Newland, OSU's bursar (Berman, Wall Street Journal, 10/22).

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