Seven out of ten college students are less confident about their ability to pay off their student debt. That figure is one reason why Indiana University has initiated a Higher Education Financial Wellness Alliance. The alliance was announced Monday during the Higher Education Financial Wellness Summit held in Bloomington. IU says the alliance will take a proactive approach to students’ financial knowledge and decision-making when it comes to borrowing money. "There has never been a greater focus on student finances, from student loan debt to the role that student finances play in student success," said Phil Schuman, director of financial literacy for IU and executive director of the alliance.
The alliance will provide online and in-person training to staff. Those staff members will then work with students on their financial wellness education.
Schuman says college debt weighs heavily on student’s minds. "Institutions are increasingly looking for ways to support student financial wellness, and the alliance will provide the premier opportunity for them to develop new programs, learn about best practices and contribute to this important national conversation."
A recent study of 17,500 undergraduate students conducted by Trellis, a 501(c)(3) nonprofit focused on student finances, reveals some interesting data about students’ concerns about their student debt:
- Only 21 percent of respondents could correctly answer three financial knowledge questions relating to loan terms, interest rates and repayment options.
- 65 percent of students say they worry about having enough money to pay for school.
- 68 percent of respondents who borrowed a student loan were less than confident they would be able to pay off their student debt.
A pilot program will get underway still this year and full operations begin in January. The alliance is not limited to IU. Schuman says any university is welcome to join.