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

Lowering Student Debt-Reversing the Upward

TrendPresenter

Tim BakulaAssociate Director of Student Financial Aid, University

of Northern Iowa

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

o In-state, Undergraduate Tuition: $7,685o On-Campus Room and Board: $7,820o Overall In-state COA: $18,880

• 13 staff, 1 graduate assistant, approximately 30 student employees

The Project on Student Debt 2007

National Trends

National Trends

National Trends

UNI’s Average Debt Upon Graduation

Student loan indebtedness

decreased by 7.6% currently averaging 23,575 from 25,523

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

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

Federal TEACH Grant Program

• First & Second Yearso FA point person established & University buy-ino Created posterso Marketed to students in appropriate majorso Students initiated the request to be awarded

• Third Yearo Packaged students that had the award in prior year

and still eligibleo Trained student workers to assist with counseling

• Fourth year and currentlyo Batch packaging all students with eligible major

Financial Literacy Initiatives

• History Through Fall 2010o Financial Aid was the only department

working on financial literacy initiativeso Presented to classes and residence halls by

requesto Registered with Cash Course in late 2007o Provided in-office counseling by

appointment • Determining how much aid to accept• Private Loan counseling• Budgeting basics

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

Infancy of “Live Like a Student”

• Overwhelming amount of materialoUsed NEFE High School Financial

Planningo http://hsfpp.nefe.org

• Wanted sessions to be in personoConcept born from Speed Reading and

Effective Study Strategies classes

• Needed to be relevant to the needs of college students

Marketing tools• University Relations

o Created logo and materials

• New Freshmen Orientationo Biggest advocates were parents

• Dept. of Residence, other Student Services• Attended Dean’s and various other faculty

meetings

Live Like a Student- Course Structure

• Relatively small, in person classes were importanto Enrolled 15 students per sessiono Engagement and discussion have been

tremendous, especially from grads and non-traditional students

• Venue also played critical roleo Class is currently offered in a centralized

location on campus as well as a campus computer lab when needed

• Timingo Offered on same schedule as regular courses

• Student led courseso Utilized Graduate Assistants to lead the classeso Allows for better connection, great experience

for student leading the class

• Incentives for attendingo $500 “Live Like a Student” scholarship was

drawn monthly

Live Like a Student- Course Content

• Focused on basic principals of money management

• 5 key competencieso Goal Setting & Budgetingo Financial Aid (2 sessions) o Understanding Credito Credit Cards o Identity Protection

• Relate these concepts to their lives as college studentso Personalization is critical

Financial Literacy Outreach

• Financial Literacy Montho Interactive

Scavenger HuntoCampus Quiz Bowlo Speakers Series

• Cornerstone Classes• Workshops

Financial Literacy Future

• Four Year Financial Literacy Plan geared at targeting students based on needs of their grade classification

• Continue expansion into campus communityo Additional peer mentoring experienceso Peer Advisors in Residence (PAIR)o First Year Experience Courses

• Enhancing online opportunities to explore financial literacy topics

Private Education Loans

Private Education Loan Counseling

• Most significant contributing factor• Comprehensive, thorough, all-inclusive, one-on-

one• Step by Step

o In 2007-2008 started one-on-one counseling with students wanting to borrow $10,000+

o In 2008-2009 added all first-time borrowers and no loan certified if remaining federal student loan eligibility

o In 2009-2010 started counseling all students with every private loan requested and each year thereafter

o No preferred lender list

Private Education Loan Counseling

Content• Budget worksheet (completed with the

counselor)• Loan repayment chart• Projected income versus loan payments• Types of payment plans• Awareness

o How much borrowed to date & lender(s)o Terms of the private loan (origination fees, interest

rate, variable interest rate, consolidation, separate payments from direct loans)

o Federal loan servicer information

Results of Private Loan Counseling

• First-time borrowerso Many reduce the amount or decided not to borrow

• Second-time borrowers o 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)

In SummaryCombined efforts of these programs over the last 3 to 5 years resulted in the reduction to student debt

o Federal TEACH Grant Programo Financial Literacy InitiativesoPrivate Loan Counseling

Questions/Comments

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