Preparing Our Students for Financial Responsibility
By Dr. Clive Muir
The multicultural services director at one of America’s leading research
universities couldn’t believe what had happened to a prize student. Everyone thought Tim (not his real name) had it together. He had held highly visible positions in minority and majority student organizations. He dressed smartly, carried a briefcase — not a book bag — and lunched with senior administrators on campus. He graduated with a high GPA and obtained a competitive internship in Washington, D.C.
But when he arrived in Washington, Tim realized that he had prepared himself in every way but one. His finances were a mess, and that closed many doors, literally, in his face.
Landlords denied his applications due to poor credit scores. With no savings and maxed-out credit cards, he could not make necessary security deposits or live as comfortably as his colleagues. He depended on friends and relatives for assistance.
On a visit to his alma mater, he urged the multicultural services office to offer personal finance workshops, so other students could spare themselves the embarrassment that he went through.
The financial problems facing college students have merited attention from college administrators, lending agencies, the media and even credit card companies. According to Nellie Mae, the federal student loan program, more than three-quarters of undergraduate students have credit cards, while 43 percent have four or more cards. Nearly 25 percent of students are $3,000 or more in debt, while many students graduate with $7,000 or more of credit card debt hanging over their heads.
Minority students fare worse than their White counterparts. Minority students are generally more dependent on grants and student loans to pay college expenses, and many of them are first-generation college students. They have little first-hand experience juggling tuition payments, car loans, rent and day-to-day expenses. And when finances are tight, they are less able to turn to their parents for help.
