Lowering Student Debt-Reversing the Upward Trend

1. Lowering Student Debt-Reversing the Upward Trend Presenter Tim Bakula Associate Director of Student Financial Aid, University of Northern Iowa

2. University of Northern Iowa • Public, 4-year and above • Iowa’s number-one teacher education program • 12,159 students • 87% undergraduates • 90% of students are from Iowa • 2013-14 Costs • In-state, Undergraduate Tuition: $7,685 • On-Campus Room and Board: $7,820 • Overall In-state COA: $18,880 • 13 staff, 1 graduate assistant, approximately 30 student employees

3. The Project on Student Debt 2007

4. National Trends

5. National Trends

6. National Trends

7. UNI’s Average Debt Upon Graduation

8. Student loan indebtedness decreased by 7.6% currently averaging 23,575 from 25,523

9. Contributing Factors • Federal TEACH Grant Program • Financial Literacy Initiatives • Private Loan Counseling Combined efforts of these programs over the last 3 to 5 years resulted in the reduction to student debt

10. Federal TEACH Grant Program • Participated since inception 5 years ago • Provides $4,000 per year for a total of $16,000 • 640+ recipients per year for $2.28M • Nationally the #1 public university in dollars & #2 in number of students

11. Federal TEACH Grant Program • First & Second Years • FA point person established & University buy-in • Created posters • Marketed to students in appropriate majors • Students initiated the request to be awarded • Third Year • Packaged students that had the award in prior year and still eligible • Trained student workers to assist with counseling • Fourth year and currently • Batch packaging all students with eligible major

12. Financial Literacy Initiatives • History Through Fall 2010 • Financial Aid was the only department working on financial literacy initiatives • Presented to classes and residence halls by request • Registered with Cash Course in late 2007 • Provided in-office counseling by appointment • Determining how much aid to accept • Private Loan counseling • Budgeting basics

13. Financial Literacy Initiatives • Increased efforts three years ago • Live Like a Student courses • Money management & awareness outreach • Marketing tools • Participated in First Year Experience (cornerstone classes) • More than 4,600 students have participated in initiatives

14. Infancy of “Live Like a Student” • Overwhelming amount of material • Used NEFE High School Financial Planning • http://hsfpp.nefe.org • Wanted sessions to be in person • Concept born from Speed Reading and Effective Study Strategies classes • Needed to be relevant to the needs of college students

15. Marketing tools • University Relations • Created logo and materials • New Freshmen Orientation • Biggest advocates were parents • Dept. of Residence, other Student Services • Attended Dean’s and various other faculty meetings

17. Live Like a Student- Course Structure • Relatively small, in person classes were important • Enrolled 15 students per session • Engagement and discussion have been tremendous, especially from grads and non-traditional students • Venue also played critical role • Class is currently offered in a centralized location on campus as well as a campus computer lab when needed • Timing • Offered on same schedule as regular courses • Student led courses • Utilized Graduate Assistants to lead the classes • Allows for better connection, great experience for student leading the class • Incentives for attending • $500 “Live Like a Student” scholarship was drawn monthly

18. Live Like a Student- Course Content • Focused on basic principals of money management • 5 key competencies • Goal Setting & Budgeting • Financial Aid (2 sessions) • Understanding Credit • Credit Cards • Identity Protection • Relate these concepts to their lives as college students • Personalization is critical

19. Financial Literacy Outreach • Financial Literacy Month • Interactive Scavenger Hunt • Campus Quiz Bowl • Speakers Series • Cornerstone Classes • Workshops

20. Financial Literacy Future • Four Year Financial Literacy Plan geared at targeting students based on needs of their grade classification • Continue expansion into campus community • Additional peer mentoring experiences • Peer Advisors in Residence (PAIR) • First Year Experience Courses • Enhancing online opportunities to explore financial literacy topics

21. Private Education Loans

22. Private Education Loan Counseling • Most significant contributing factor • Comprehensive, thorough, all-inclusive, one-on-one • Step by Step • In 2007-2008 started one-on-one counseling with students wanting to borrow $10,000+ • In 2008-2009 added all first-time borrowers and no loan certified if remaining federal student loan eligibility • In 2009-2010 started counseling all students with every private loan requested and each year thereafter • No preferred lender list

23. Private Education Loan Counseling Content • Budget worksheet (completed with the counselor) • Loan repayment chart • Projected income versus loan payments • Types of payment plans • Awareness • How much borrowed to date & lender(s) • Terms of the private loan (origination fees, interest rate, variable interest rate, consolidation, separate payments from direct loans) • Federal loan servicer information

24. Results of Private Loan Counseling • First-time borrowers • Many reduce the amount or decided not to borrow • Second-time borrowers • Come prepared and borrowing responsibly • Today we see approximately 500 students per year • Today average private loan debt is $12,196, was $17,892 in 2009-2010 (-$5,696 a 31.8% decrease) • 329 students graduated with private education loan debt compared to 597 in 2009-2010 (44.9% decrease)

25. In Summary Combined efforts of these programs over the last 3 to 5 years resulted in the reduction to student debt • Federal TEACH Grant Program • Financial Literacy Initiatives • Private Loan Counseling

26. Questions/Comments Tim.Bakula@uni.edu 391-273-2722