2009 IHEP Symposium on Financial Literacy and College ...Today’s Agenda Best Practices in Student Financial Literacy First year and entering students Second year students and beyond

Financial Literacy and College Success at Minority-Serving Institutions

Model ProgramsModel Programs

Lana Low, Ph.D.Retention & Financial Literacy

Research & Consulting

2009 IHEP Symposium February 26, 2009San Antonio, Texas

Today’s AgendaBest Practices in Student Financial Literacy

First year and entering studentsSecond year students and beyondAssessment the effectiveness

Model Financial Literacy ProgramsSouth Mountain Community College – Counselor and FacultySitting Bull Tribal College – Financial Aid DirectorPrairie View A & M University – Associate Provost and Financial Aid DirectorSpelman College - Students

Your Questions

FYIObserving Save the Trees philosophy, thus PowerPoint presentations will be available on the IHEP website.Structure of sessions Incorporating your best practicesThe panelists will be available throughout the day for any questions you don’t get answered during the discussions.

“While freshmen and their parents are likely thinking more about tests and academics during orientation, the fact is that after graduation a student's credit rating is arguably far more important to his or her future than grade point averages.”

Why Financial Literacy?

Robert D. Manning, Ph.D., Author - Credit Card NationResearch Professor and the Director of the Center for Consumer Financial Services at Rochester Institute of Technology.

What is financial literacy?Money Debt

Those who believe that the only certainties in life are death and taxes can now add a third to the list:personal debt.

Karen KrebsbachUS BankerFebruary, 2006

8

Current State of Financial Literacy

College students are not prepared to manage their personal financesParents are not providing the financial experiences students need Higher education is slow in responding to students’need for financial educationThere is uneven delivery and availability of personal finance services

Percentage of questions answered correctly by: High School Seniors

1997 – 57.3%2000 – 51.9%2002 – 50.2%2004 – 52.3%2006 - 52.4%2008 - 48.3%

Student Preparedness: Jump$tart Financial Literacy Survey

Jump$tart Coalition 2008

Percentage of questions answered correctly in 2008 by:High school seniors

2008 - 48.3%*College students

2008 – 62.0%College freshmen

2008 - 59.4%College seniors

2008 – 65.0%

*College scores increased with students’ rank in school.

Student Preparedness: Jump$tart Financial Literacy Survey

Jump$tart Coalition 2008

Key Research Finding

Finance classes help more in college than high school.

http://www.extension.org/pages/Personal_Finance_Classes_Help_More_in_College_than_High_School

Jonathan Fox at The Ohio State University,August 10, 2007.

http://www.extension.org/pages/Personal_Finance_Classes_Help_More_in_College_than_High_School

Parental InfluencesHow America Pays for College

70 percent of students and parents said a student’s expected post-graduation income did not make a difference on their borrowing decisions?

With so many students and their parents not considering cost in the college selection process, the stage is set for student success issues.

2008 Study conducted by Gallup Organization for Sallie Mae

Focus on the Goal:

Financial FluencyKnowledgeBehavior

Model Programs Part 1

Entering and first-year student financial literacy programs

Best Practices in Financial Literacy

Entrance counselingExit counselingStudent orientationParent orientationStudent success coursesSeminars/workshopsMoney management counselingPeer financial counselingCareer developmentAlumni programs

Nationally-Recognized Programs

ParticipantsBrigham Young University →University of Arizona →University of Georgia →Iowa State University →

Montana State University →Ohio State University →Texas Tech University →Wright State University →

ProgramsFinancial Path to GraduationCredit Wise Cats Peer Financial CounselingConsumer & FinancialManagement PublicationsFamily Financial Literacy ProjectFreshmen Success SeriesRed to BlackWright Financial Path

Brigham Young UniversityFinancial Path to Graduation

Strength: Positioning/Infrastructure• Academic planning and financial planning proceed on

parallel tracks.

• Students must file a financial plan with the Financial Aid Office before their loan eligibility is certified.

• This process informs how much students will need to borrow to finance their education and the impact on their lives after graduation.

Website: http://saas.byu.edu/depts/finaid/documents/fp2g.pdf

http://saas.byu.edu/depts/finaid/documents/fp2g.pdf

University of ArizonaCredit Wise Cats

Strength: Peer-to-Peer Program

• Credit Wise Cats is a student-run group on a mission to educate students about smart spending and financial planning.

• UA's Credit Wise Cats said they counsel people with practically any financial woe through a series of group workshops or one-on-one meetings.

Website: http://wildcat.arizona.edu/papers/98/32/01_8.html

http://wildcat.arizona.edu/papers/98/32/01_8.html

Iowa State UniversityConsumer & Financial Management

Strength: Use of Technology• The Internet is used to offer select information to

individuals

• One creative example of using technology to spread financial literacy is the weekly financial tips.

• Over 40,000 individuals signed up to receive weekly financial tips during a three-year period.

Website: http://www.joe.org/joe/2004october/tt5.shtml

http://www.joe.org/joe/2004october/tt5.shtml

Iowa State UniversityGovernment of the Student Body (GSB)

Strength: Student Initiated and Funded• Funded a financial information campaign in response to press

coverage about excessive student debt.

• A recession calls for us to make tough choices, but a recession is exactly the time when economic and financial education is so critical.

• Will promote existing programs: Tip of the Week, financial literacy classes, and a Financial Counseling Clinic.

Websites: http://www.joe.org/joe/2004october/tt5.shtmlhttp://www.iowastatedaily.com/articles/2009/01/28/opinion/todays_editorial/doc498131b7bc49d601484826.txt

http://www.joe.org/joe/2004october/tt5.shtml

Get Financially Fit: a list of websites for college students.

http://www.consumerinterests.org/files/public/Get_Financially_Fit_Education_Program_List.pdf



PanelistsSouth Mountain Community College

Cori WashingtonCynthia Walston

Sitting Bull Tribal CollegeDonna Seabord


First year and entering studentsSecond year students and beyondAssessment the effectiveness


Your Questions

Financial Literacy and Retention

What is the relationship between financial literacy and student retention?

Retention Issues: Your List 2006

Institutional commitmentSophomore slumpTime managementAdjusting sociallyAffordabilityParent rolesFinancial literacy Customer serviceCareer planningGraduation vs. goal completion

Common Institutional Goals of Financial Literacy Interventions

• Lower loan default rate• Lower average credit card debt• Decrease number of credit cards• Increase first-year retention rates• Increase graduation rates

Where would you look to find the relationship between retention and financial literacy on your campus?

Loan DefaultStudent AttitudesDOE: Retention DataAffordability

Predicting Loan DefaultStudent loan default studies indicate overwhelmingly that student success plays a bigger role in predicting who will default than either borrower background or institutional characteristics.

Freshman Attitudes Report2008 Report

18.2% of students are in a bad financial position, and the pressure to earn extra money will probably interfere with studies.

28.7% have financial problems that are very distracting and troublesome.

Would like to talk with someone30.2% getting loan45.7% getting part-time job41.5 summer employment

2009 Report18.2% of students are in a bad financial position, and the pressure to earn extra money will probably interfere with studies.

29.3% have financial problems that are very distracting and troublesome.

Would like to talk with someone:31.5% getting loan47.3% getting part-time job44.3 summer employment

2008, Noel-Levitz

Department of Education Statistics

9,000 students surveyed from 800 postsecondary institutions

approximately 3,300 did not successfully complete the program in which they were enrolled14 percent of students who left cited financial reasonsOnly 2 percent cited academic reasons

Affordability and Retention

Carry a balance on their credit cards.Come from a family that cannot afford to pay for college without loans.Not have money to participate in the activities they enjoy.Have a lower GPA.Have reduced their course load because of debt.

Students who take longer to graduate are the least likely to be able to afford it, they are most likely to:

Barbara Wharton, 2007http://studentaffairs.osu.edu/pdfs/assess_presentation_ACPA_NASPA_07_Section3.pdf

CSRDE 2008 Retention Awards

“A Systemic View of Academic Achievement, Academic Progress and Degree Completion: A Longitudinal Study.

“SUCCESS CHALLENGE: Placing Student Success at the Center-- Enabling In-State, At-Risk Students to Successfully Earn Baccalaureate Degrees in a Timely Fashion.

“The Attack of the Killer Courses: How Course Taking Patterns Affect Retention”

A National Call to Action

President Advisory Council on Financial Literacy: 2008 Annual Report

Recommendation Conduct additional research into the feasibility of requiring college students to take a course in financial literacy or pass a competency test as a condition of receiving government-backed student loans.

Successful financial literacy and retentionpractices must provide students with the tools they need to survive –before they know they need them.


Financial literacy programs for second year students and beyond

Boston College:“Successful Start” Financial Literacy Program

Sponsored by: Office of Student ServicesMission Statement: financial management for lifeWorkshops: all aspects of financial managementAre You Ready for the Challenge? borrowing and using credit responsiblyDid You Know? credit pitfalls and warnings

http://www.bc.edu/offices/stserv/meta-elements/pdf/brochure.pdf

Successful Start (continued)Are You Ready for Additional Help? websitesUpcoming Workshops: “Are you ready for that job offer?”Past Workshops: Example “How will I survive?”What People Are Saying: testimonials

http://www.bc.edu/offices/stserv/meta-elements/pdf/brochure.pdf

University of North TexasStudent Money Management Center Runs a Web site and offers one-on-one meetings and group educational sessions.Targets workshops to certain groups – freshmen, graduating seniors, and many moreMoney management topics, such as budgeting, apartment leases, credit cards and credit reports, college and living expenses, car buying, student loan repayment strategies and affording study abroad programs. Administered by Division of Student Development Works closely with Office of Financial AidAdministers two loan programs to help students with unanticipated expenses that endanger their re-enrollment

Stanford UniversityMary Morrison, director of funds management in financial aid office“How to live without your parents’ money”Enlightenment called for when student asked, “Where do I get my W-2 cashed?”One student convinced that the payroll department was stealing money withheld from her check.Uses practical approach: bag of groceriesBest taught to seniorsBig project is planning budget to match average starting salary of Stanford graduate.

http://chronicle.com/temp/reprint.php?id=53vn46yrjgnz5snjn6c6py6lz5ynl0js

PanelistsPrairie View A&M University

Dr. Carlos Clark

Spelman CollegeMichelle JenkinsJocelyn Mason-Saffold


First year and entering studentsSecond year students and beyondAssessing the effectiveness


Your Questions

“What gets measured gets done!”

Recent survey at professional development conference

What are your goals related to financial literacy activities? What are your financial literacy activities? How are you evaluating your activities?

Surveys to monitor progressTrack student debt loadsWondering how to evaluate Use suggestions students make# of usersStudents themselves help me evaluateWe just launched the program……Mmmmm good?

2008 Kim Brown & George CovinoAAMC Session

What Do We Measure?

Changes in student engagement scoresMotivation levels of freshmenAcademic success goals of studentsChanges in student expectations and satisfactionChanges in student achievement

Measurement Tools of Choice

Surveys

Focus groups

Interviews

Case studies


Assessing the effectiveness of financial literacy programs

A Simple Approach to Assessment

A Case Study: The University of Hawaii at Manoa

Source: Journal of Family and Consumer Science, 2007, Vol. 99, No 3. Financial Information Project: Assessing the Financial Interests of College Students.

The “I – 4” Paradigm

Information Inquiry Intervention Impact

Financial Literacy

What do we know about financial literacy?What do we know about our students?What do we know about our institution?


Financial Literacy

UH Manoa: InformationTwo out of three students leave college with debt.The effects of college debt are far-reaching.There has been a significant increase in bankruptcy filings by the under age 25 group.80% of undergraduate students have between one and four credit cards.High school students have limited access to financial education other than what they learn from parents.81% of parents rated their money practices as poor.Only 10% of students in the Family and Consumer Sciences upper division classes had any formal money management coursework

What do we need to know?How do we find out?What will we do with the information?


Financial Literacy

UH Manoa: InquiryStudents were asked to complete a survey:

What kind of financial information would be of interest to college students?How would students prefer the information be delivered?

Faculty and staff completed parallel survey:Included those who counsel or teach students in the area of money management.Questions focused on interest, preferred presentation, and delivery

UH Manoa: Inquiry (continued)

Financial information of interest to students:Investing for the future. Getting ahead financially after graduation. Avoiding credit problems. Budgeting income and expenses.

Information of interest to faculty staff:BudgetingAvoiding credit problemsMaking the most of student loansAvoiding ID theft, fraud, and scams

UH Manoa: Inquiry (continued)How students prefer to receive financial information:

As part of a financial aid interviewAs part of special event with free foodAs part of extra credit in a university classThrough a websiteAt the university’s New Student Orientation program

Faculty and staff choices for delivery of information:As part of special event with free foodThrough a websiteAs part of extra credit in a university classAs part of a financial aid interviewAt the university’s New Student Orientation program

What did we learn?What can/should we do about it?


Financial Literacy

UH Manoa: InterventionValidated student interest in a variety of financial topics and they have definite ideas on how they would like to receive the information.

Concluded that students are interested in learning about financial futures; faculty and staff focus on the present.

Identified a cadre of faculty and staff to collaborate on delivery of programs that reach a wider college student audience.

Recognized the importance of surveying intended audience and their teachers before selecting a program.

UHM: Intervention (continued)Began with a pilot financial education project.Peer financial educators were selected.Utilized common interests indicated by students and faculty/staff in the selection of a curriculum. Twelve curricula were reviewed for relevance and quality of materials.

What worked? What didn’t?What’s the payoff for the student? What’s the payoff for the institution?


Financial Literacy

UHM: ImpactWorkshop Participation

20 sessions for 500 students offerednew-student orientation workshops, dormitory programs freshman seminars ad hoc requests

Workshop Evaluations471 students gained new knowledge and understanding of basic personal financial management. When compared with non-participants, workshop attendees had increased their awareness of money management practices.

Workshop participants demonstrated greater awareness on 13 of 20 indicators, with significant differences on five of those indicators.

UHM: Impact (continued)Program Growth:

Shilder College of Business faculty now incorporate the materials in training peer educators and other students pursuing financial planning as a career.

Students can get class project credit for developing, offering and assessing financial education units for their peers

Offering program online

Where is your focus?


Financial Literacy

2009 IHEP/MSI Symposium 1

2009 Symposium on Financial Literacy and College Success at Minority Serving Institutions:A Report on Tribal Colleges

Donna M. SeaboySitting Bull College


History of Sitting Bull College

• Located on Standing Rock Sioux Reservation

• Main campus located in Fort Yates, ND• Additional sites in McLaughlin and

Mobridge, SD


History of Sitting Bull College

• Chartered by Standing Rock Sioux Tribe on 9-21-73 as Standing Rock Community College

• One of the original five tribal colleges established

• Accredited through Higher Learning Commission of the North Central Associations of Colleges and Schools

• Name changed to Sitting Bull College 3-6-96


Who Are Our Students?

• Average 300 students/semester• 71% Female/29% Male• 90% Native American• 73% Single• 31 Average Age


Sitting Bull College Strategic Plan

Goal Number 4 (ended July 08): To Increase Retention Objectives

• Increase semester completion rate from 67% to 70%.• Increase retention rate from 38.3% to 41.3%.• Increase persistence rates from 59.8% to 62.8%.


Sitting Bull College Strategic Plan

New strategic Plan July 2008:Goal Number 2: To have created opportunities for students to

actively participate in student centered initiatives by 2013. Objective 2: To have increased retention 2% per year using the 2005-2006 benchmark of 39.8% through 2013.


Results

2006-2007 Outcomes• Semester completion rate

– Fall 06 63.2% – Spring 07 56.9%

• Persistence rate 64.8% Retention rate 40.3%


– Fall 07 54.3% – Spring 08 56.1%

• Persistence rate 54.5% Retention rate 53.3%


Results


– Fall 08 62.3% • Persistence rate 66.7%


PSY 100 Psychology ofStudent Success

• Orientation course that is mandatory for all new students and should be taken during their first semester at SBC.

• Course is designed to make the adjustment to college life a pleasant experience.

• Financial literacy is an important component of the course.


PSY 100 Financial Literacy Component

Unit One: Charge It Right –using credit cards responsibly.Unit Two: To Your Credit – reading a credit report and building/repairing credit history.Unit Three: Pay Yourself First –identifying ways to save money and introducing options for saving toward their goals.Unit Four: Money Matters –managing money by preparing a personal spending plan and identifying ways to decrease spending and increase income.


Progress

Reason for Withdrawal: Financial Difficulties17 (15%) Fall 2005 115 drop slips6 (8%) Spring 2006 77 drop slips5 (5%) Fall 2006 105 drop slips0 (0%) Spring 2007 71 drop slips2 (2%) Fall 2007 94 drop slips3 (5.5%) Spring 2008 54 drop slips2 (3.1%) Fall 2008 63 drop slips


American Indian Higher Education Consortium (AIHEC)• Regular Members (32)• Associate Members (4)• International Members (1)• Survey Participants (14)

www.aihec.org


$ U R V E Y

• Is your college providing financial management education to its students?– 8 YES– 6 NO– 0 NOT SURE


$ U R V E Y• Tell me what you do to provide this service

to your students.– Required academic course– Orientation/Workshops– Local Bank Representatives– Entrance/Exit Loan Counseling


$ U R V E Y• Have you assessed its effectiveness?

– 0 YES– 2 NO– 12 NOT SURE

• What were the results of your assessment?– n/a


$ U R V E Y

• Do you plan to expand or change your methods for providing this service to your students? How?– TRIO is setting up workshops on debt

management and credit card use– New Position with specific duty of

establishing financial education program– Access local JumpStart Coalition resources


$ U R V E Y

– Try to set up IDA (individual development accounts) for specific savings objective

– Set up workshops on budgeting and using local resources

– Work with students in applying for financial aid early to meet deadline dates


$ U R V E Y

• How often do you disburse financial aid?– 12 Once per term (federal and A*CF) – 2 No response (federal and A*CF)– 4 Multiple disbursements (stipends)


Summary

• Financial education is an issue in Indian Country that is being addressed – however, it appears on a small scale.

• Don’t need to reinvent the wheel– USA Funds Unlock the Future– Money Smart– Jump$tart

SOUTH MOUNTAIN COMMUNITY COLLEGE

MARICOPA COMMUNITY COLLEGE DISTRICTCORI WASHINGTON, CHAIR

DIVISION OF COUNSELING, HEALTH, AND WELLNESS

CYNTHIA WALSTON, ADJUNCT COUNSELING FACULTY

Personal Money Management for College Students

CPD108

CPD STANDS FOR

COUNSELING AND PERSONAL DEVELOPMENT

OUR MOTTO

“GOT A LIFE? BECAUSE LONG AFTER GRADUATION, YOU’LL STILL HAVE A LIFE©”

What is CPD?

Why do students enroll?

Loans are NOT auto-packaged in the financial aid process at SMCC.

All student loan borrowers MUST complete an on-line loan counseling session.MUST complete a detailed budget for the academic year.MUST take CPD108, a personal Money Management course taught by Counseling Faculty from SMCC sometime within the academic year. Materials utilized are ‘Life Skills’ provided by USAF/SallieMae.MUST complete an Exit Counseling session between their freshmen and sophomore year, even though they are continuing their education with SMCC. Previous generational values and behaviors

that influenced current college students

Additional Student Loan Requirements

Students must request student loans by a separate process; complete and additional in-person group counseling session.provide a program of study to the FA Office.review their NSLDS (National Student Loan Database System) record annually to understand their aggregate loan indebtedness.Students who leave, drop out or graduate are required to complete the Exit Loan Counseling again as well.

stay within a reasonable community college loan level of indebtedness. With the new increases, effective July 1, 2008, SMCC recommends dependent students stay within a $12,500 aggregate and independent students stay within a $25,000 aggregate. These levels may be exceeded; however, a close review of each student’s goals, aspirations and indebtedness is evaluated on a case-by-case basis.

Students who are in repayment and delinquent receive communications from SMCC through Debt Manager, a USAF/SallieMae default prevention product.

Previous generational values and behaviors that influenced current college students

Family Responsibilities

Full time employment

First Generation College Student/Adult Student

Lack/no experience with large sums of money or access to money

Poor/no experience with money management

South Mountain Community College

Default Information

The above graph indicates the default percentage at SMCC .

Note: 2002 & 2003 had 0 default rate.

The above graph denotes the actual number of student loans

awarded and defaults.

Now that we have you in class…

GOOD MORNING. TELL US WHY YOU’RE HERE

TOP 5 RESPONSES

I DROPPED IT LAST SEMESTER AND I CAN’T GET MY LOAN

FINANCIAL AID MADE ME

I CAN’T GET MY REFUND CHECK UNTIL I TAKE THIS CLASS

I NEEDED ONE MORE CREDIT

I HAD NOTHING ELSE TO DO AT 8:00 AM ON A SATURDAY MORNING☺

CREATING CPD108

PRESENTATION OUTLINE: PART 1

Course inception• Initiation and collaboration with the Financial Aid Office of SMCC

Goal and Purpose for collaboration• Why is there a need for this course?

Maricopa District Counseling Instructional Council • Steps in establishing new course.

Course Development• Course Description: Counselors’ focus on emotions connected with

attitudes, behaviors, and thinking about money

• The official course competencies and outline.

TEACHING CPD108

PRESENTATION OUTLINE: PART 2

• Guided Imagery

• Life Planning

• Budgeting

• Educational Planning

• Academic Success

• Occupational Projections

• Where does my income come from?• Cashflow Quadrant

• Current economic situation• How is the current economy affecting you?

Utilizing USAFunds and other resources

COURSE INCEPTION:Initiation and collaboration with the Financial Aid Office of SMCC

Financial Aid PerspectiveIn 1989, South Mountain Community

College decided to cease participation in the student loan program with a default

rate at 23%

Typical reasons for not repaying loan

But I didn’t graduate…I’m not working…

I’m still in school, but part time…I thought it was a grant…

Inez Moreno-WeinertFinancial Aid Director

COURSE INCEPTION:Initiation and collaboration with the Financial Aid

Office of SMCC

Counseling Perspective

Emotions associated with money and debt

•Personal responsibilities associated with money

•Family obligations

•Work responsibilities

•Current/past debt any other related concerns

•Freedom and status

•Distress – “Retail Therapy”

Delayed Gratification/Immediacy

Magical Thinking/Freedom to Spend

•It’s similar to my IRS refund

Lack of Respect for the value of money

Cori WashingtonCounseling Center, Director

FINANCIAL AID GOALSFINANCIAL AID GOALS COUNSELING GOALSCOUNSELING GOALS

Decrease default rate

Financial literacy

Loan responsibility

Healthy money management

Delayed gratification

Detaching emotional ties to money

GOAL AND PURPOSE FOR COLLABORATION

Course Development

COLLEGE MONEY MANAGEMENT IS DESIGNED TODesigned to assist students in examining values related to spending, borrowing, and

saving money.

Identify financial priorities and responsibilities associated with debt.

Develop and follow a personal budget plan and learn strategies for maintaining a financially balanced personal life.

COURSE DESCRIPTION

THE 10 OFFICIAL COURSE COMPETENCIES

1. To prioritize personal needs and wants

2. Explain the concept of delayed gratification

3. Track monthly income and expenses

4. Develop a personal budget plan

5. Identify strategies for reducing personal debt

THE 10 OFFICIAL COURSE COMPETENCIES

6. Identify money saving strategies

7. Determine the cost of obtaining an Associate’s and Bachelor’s degree

8. List responsibilities associated with federal student aid

9. List responsibilities associated with using credit cards

10. Describe ways to balance financial commitments related to school, work and relationships

Guided Imagery

The Perfect Day!It is five or ten years from now. Imagine yourself enjoying a day in

which you are doing everything and anything you want to. You have no financial or time restraints except

the ones you give yourself.

In writing, describe your perfect day from the time you get up until the

time you go to sleep!

Enjoy!

LIFE PLANNING

Creating a Budget (Modules 1: USAFunds)

• Needs vs Wants

• Impulse purchases/retail therapy

• Monthly expenses

• Monthly income

• Annual credit reports

• Credit Cards

• FAFSA

EDUCATIONAL PLANNING

(USA FUNDS MODULE 3)

EDUCATIONAL PLANNING


ACADEMIC SUCCESS


ACADEMIC SUCCESS


FAFSAOther Financial Aid Requirements

Curriculum Requirements

GPA

Major Requirements

Transferring/Graduate School

Requirement

Time ManagementStudy Skills

Note takingLearning Styles

Campus ResourcesRegistration and AdvisementLearning Resource CenterLibraryTechnology Center

Understanding ExamsExtra Curricular Activities

LIFE PLANNING

OCCUPATIONAL PROJECTIONS(USA FUNDS MODULE 4)

OCCUPATIONAL PROJECTIONS(USA FUNDS MODULE 4)

Interest inventory

Major and degree requirements

Occupational and workforce

projections

Alternative incomes by developing individual financial plans. (Robert Kiyosaki)

LIFE PLANNING

EmployeeEmployee Self EmployedSelf Employed

Good ThingsHealth/Life Insurance

Sick/vacation days

Guaranteed pay for work

Job descriptions

Bad Things• Not able to

make decisions

• Little freedom

• Bad bosses and coworkers

• Taxes

Good ThingsMake most decisions

Can set prices and income

Set work schedule

Hire/fire employees (if applicable)

Tax benefits

Bad Things• Bad employees

• Personal illness (If you don’t work, you may not be paid)

Cash Flow Quadrant

Business OwnerBusiness Owner InvestorInvestor

Good ThingsLittle input

Significant financial gains

Control and work freedom

Taxes

Bad ThingsBad/lazy employees

Double taxes (certain businesses)

Natural/man made disaster

Good Things• Make all

decisions

• Create business cycle

• Can stay at home and still make money

Bad Things• Bad business plan

• Market change

• Natural/Man made disaster

• Taxes

Cash Flow Quadrant

EMPLOYEE BUSINESS OWNER

SELF EMPLOYED INVESTOR

Works the system Creates the system

Which side of the quadrant do you want to be on!

Cash Flow Quadrant

What’s Going On?What’s Going On? Typical Student Responses:Typical Student Responses:

Have students list what’s happening in their personal lives that has been affected by the economy.

Housing Crisis

Economic slump (workforce decline)

War

Immigration

Current Economics

Additional Resources

ADDITIONAL RESOURCESBooks:

Who Moved My Cheese?

Dr. Spencer Johnson, M.D.

Rich Dad, Poor Dad

Robert Kiyosaki

Cash Flow Quadrant

Robert Kiyosaki

Web locations:

www.usafunds.org/toolkit

www.annualcreditreport.com

http://www.usafunds.org/toolkit

http://www.annualcreditreport.com/

Documents

2009 IHEP Symposium on Financial Literacy and College ...Today’s Agenda Best Practices in Student Financial Literacy First year and entering students Second year students and beyond