National Foundation for Credit Counseling releases video focused on credit issues facing college students: ""College Credit for Life," a nine-minute video that introduces students to lessons surrounding the temptations and responsible use of credit cards. Much of the video features young people talking about the mistakes they themselves made in college. The video also features other voices, in the form of an apartment rental agent, a car salesman, and a human resources executive, all discussing the implications that both responsible or irresponsible use of credit can have as students prepare to move on from college and into the real world."
Prevalence of programs: 48% of the 230 respondents indicated that their school is currently offering a financial literacy program. For those schools that don't currently offer a program, 51% expect to start one over the next 12-18 months.
66% of schools with a financial program did not have any budget monies set aside for this purpose; 16% had a budget less than $5,000.
The results come from the SLA 2010 Financial Literacy Survey (full results to follow in the next day or two). Thank you to the over 220 respondents to the survey. Sixty-three programs were named by the sixty-nine respondents to this specific question indicating the multiplicity of literacy programs available from a variety of providers. For the second year in a row, NEFE's CashCourse is the top program mentioned by financial aid administrators (click here for last year's results). Their website now indicates that their product is being offered at over 502 campuses making them the closest to a market standard at this point. Please note however, that it is difficult to gauge the usage patterns of their product. I didn't come across such statistics (if anyone has them, please feel free to pass along).
Here are the programs mentioned, with the frequency that they were named in response to this open-ended question on the survey: What source(s) would you recommend for a financial aid administrator interested in developing a financial literacy program for his/her institution?
U.S. Bank has lowered the interest rate ranges on their private student loans effective as of November 1, 2010. The new range of interest rates offered by U.S. Bank now stands at 3.45% to 10.95%, compared to their previous range of 4.20% to 12.20%. As a result of this change, SLA has upgraded the rating on the U.S. Bank product to 3 1/2 stars. U.S. Bank's last pricing change occured in April when they lowered their minimum rate from 5.20% to 4.20% while leaving their maximum rate unchanged.
SLA is the midst of their 2010 Financial Literacy Survey which closes on Friday. Ping me at tranzetta@studentlendinganalytics.com if you would like to participate. We have almost 200 responses already.
Elizabeth Warren, director of the Consumer Financial Protection Bureau, spoke to student journalists earlier this week about financial literacy:
Knee-deep into my annual analysis of school lender lists and the prevalence of lenders on those lists, I thought I would come up for air and highlight some interesting observations:
Western Michigan University used results from a student survey to rate their alternative lenders. The five survey questions focused on application process, value, customer service, would student recommend to friend and overall satisfaction. Almost 20% of their student borrowers responded to the survey. With a top possible score of 20, the scores for the seven lenders varied from 12.97 to 15.85.
Please contact me at tranzetta@studentlendinganalytics.com if you are interested in implementing a similar survey tool at your school (at no cost!)
First to provide some context, here are the six top sources of student aid in 2009-10 representing over 90% of student aid (includes graduate and undergraduate aid sources which in total amounted to $199.2 billion for 2009-10):
Federal loans ($96.8 billion) or 49% of total aid
Institutional grants ($33.4 billion) or 17% of total aid
Pell grants ($28.2 billion) or 14% of total aid
Federal grants other than Pell ($13.1 billion) or 7% of total aid
Private and employer grants ($10.6 billion) or 5% of total aid
Federal Student Aid has posted an update to their website today (thanks to Mark Kantrowitz for the heads-up). The total disbursements for Stafford, Parent PLUS and GradPLUS loans for the 2009-10 academic year came to almost $96 billion [this figure excludes Perkins Loans which are typically about $1 billion]. When comparing them to the 2008-09 data now up on the FSA Data Center site, this amounts to a 12.5% increase (or almost $11 billion). Please note that these numbers are updated frequently, which might explain why $75 billion was the number announced for 2008-09 last year by the Dept. of Education and is close to the $77 billion listed in the FSA Strategic Plan vs. the $85.1 billion that SLA calculated for 2008-09 on the FSA site this evening.
Thanks to Mark Kantrowitz for making me aware of his analysis, which is available here on FinAid.org. It shows that the growth in FAFSA (Free Application for Student Aid) filings has decelerated this year to 1.3%, having grown 17.5% in the first quarter and 12.3% in the second quarter. Since this is a seasonally slow quarter,(the first quarter is typically the strongest with volumes dropping each quarter thereafter), the year-to-date FAFSA filings are still up 11.8%. FAFSA filings by independent students only grew by 0.3%, while filings for independent students grew by 1.7%.
Wondering about growth on a state-by-state basis? Here are the FAFSA filed through the first three quarters of 2010 with states in the western US (Nevada, Arizona, Utah and Idaho) having the top four spots:
Or at least that is what one investor, New Enterprise Associates, seems to think. They recently invested $11 million in EverFi in a Series A round of financing. Here is what TechCrunch had to say in early September:
