Debt is a widespread worry, but some — including college students — are hit harder than others.
Last week, Gov. Mark Dayton declared April financial literacy month in Minnesota in an effort to educate people about debt and how to avoid it.
Various state agencies will host nearly 40 outreach events this month, and each week’s events will be geared toward a different demographic, from youth to senior citizens. This week is dedicated to higher
The state Office of Higher Education and the Department of Commerce are leading to the charge to help college students understand the far-reaching implications of student debt.
According to a study by the Institute for College Access and Success, two out of three college seniors in 2011 had student loan debt, with an average of $26,600 per student. Nationally, the accumulated college student loan debt totals about $1 trillion — in June 2010, it surpassed total national credit card debt.
Minnesota’s student loan debt is the third-highest in the nation, according to the study. The average Minnesota student has nearly $30,000 in student loans.
But even as the numbers continue to rise, students may not realize the implications of taking on debt.
Sociology and Spanish senior William Sturtz said students don’t always consider the debt they’ve borrowed before they graduate.
“I feel like a lot of what is happening with many of our students is that they are trying to bide their time on the promise of future income,” he said, “and that terrifies me.”
As part of Higher Education Week, state agencies planned 10 events focused on financial literacy for college students.
The Office of Higher Education will host a Twitter chat Wednesday, where students will be able to tweet financial questions related to higher education using the hashtags #waystosave2 and #FinLitMn, said Sandy Connolly, communications director for OHE.
“We are looking for students who have questions like how to approach student loans, how to manage student loans well, how to pay for college,” she said. “We are hoping that someone will throw a question out and another student can throw an answer back out at them.”
On Friday, the Minnesota OHE also plans to unveil College Planner, a website and mobile application for Minnesota students.
“We are hoping that students will love it and use it as their own personal toolkit,” Connolly said. “So much of what they need to know is included.”
The free app will aim to help students keep track of college events and learn about financial aid options and schools in the state.
This month, the Minnesota Department of Commerce has 30 financial tips on its website — one for each day. One of the most important tips for college students, Connolly said, is to consider job prospects before taking out loans.
“We have a rule of thumb we talk about a lot,” she said. “You should consider your debt to be about the same amount of your first year’s income of the job you are going to work.”
At the University of Minnesota, there are a number of ongoing initiatives and resources in addition to those planned for this month.
The University offers ongoing financial counseling for students through One Stop Student Services and Boynton Health Service, said Julie Selander, director of One Stop Student Services and University Veteran Services.
“We have students where [debt] causes a lot of stress and mental anxiety,” she said. “We want to get them into the hands of a professional or someone who can guide them.”
All students who take out federal or University-administered loans must also complete exit counseling before graduation, which educates students how to repay loans after school.
In 2008, One Stop Student Services launched the Live Like a Student campaign to promote financial literacy on campus.
“We were starting to see the rise of overall debt for University students and were not really sure if they understood what they were getting into when they were taking out these loans,” Selander said.
To promote financial literacy month, Live Like a Student will partner with Money Revolution — a financial outreach program for college students — to host its own version of “Cash Cab,” the popular Discovery channel game show.
The game, originally planned for this week but rescheduled due to poor weather conditions, will take place April 23 near the Science Teaching and Student Services building.
During the event, students can ride in a pedicab across the Washington Avenue Bridge while answering financial literacy questions. The event will be videotaped, Selander said, and students who participate could be part of future videos for the campaign.
“Any question in the world of financial literacy is fair game,” she said.