Council for Student Financial Success in Higher Education Annual Report 2011-2012
Introduction Helping college students repay their loans is at the core of the Council s mission, and this proved to be another successful year toward fulfilling that mission. The Council demonstrated its commitment, dedication, and support for initiatives that advance responsible student loan borrowing and wise debt management. Since its inception in 1997, the Council has produced numerous resources and led multiple efforts that have resulted in students and families improved understanding and management of personal and education finance. While students and families have benefitted from the Council s initiatives, the higher education community has also benefitted from the Council s leadership. Together with TG, members have shared their professional expertise and applied their practitioners knowledge to develop resources and leverage relationships. The Council promotes collaboration among stakeholders who share similar interests on initiatives, activities, and services that ultimately help students and families make informed decisions regarding education finance. 2 Council for Student Financial Success in Higher Education Annual Report 2011-2012
In an effort to promote the wealth of resources that the Council has produced, members dedicated this year to assessing and evaluating its initiatives to maximize the use of available resources. In 2011, the Council examined its past and current initiatives to ensure that content is relevant to its mission, that its resources are effective and utilized, and, most importantly, that it develop an appropriate communications plan for effective promotion and dissemination of resources. While the Council continues to identify ways to maximize its impact, it remains focused on decreasing student loan delinquencies and defaults. With the shared purpose of helping students succeed in college and make informed borrowing decisions, TG and the Council dedicated this year to working collaboratively to meet the following goals: Goals Develop comprehensive student loan counseling materials that will allow financial aid administrators to educate students with timely, relevant, and targeted information about student loan borrowers rights and responsibilities. Assess and monitor the effectiveness of the new intermediate student loan counseling and financial literacy modules and seek opportunities to maximize use of available resources. Conduct a research study which focuses on responsible student loan borrowing when choosing an educational program. This study will allow students and families to make an informed decision when borrowing for college. Create an opportunity for higher education community to discuss, share, and exchange ideas pertaining to student loan repayment. Create a communications plan for the Council to ensure the effectiveness of its initiatives, build Council awareness, and reinforce collaborations, partnerships, and member participation. Council for Student Financial Success in Higher Education Annual Report 2011-2012 3
Initiatives Comprehensive Student Loan Counseling For almost eight years now, the Council and TG have worked together to strengthen student loan counseling for student borrowers. Stemming from a Council-sponsored Dialogue in February 2004, TG and the Council initiated conversations for the development of loan entrance and exit counseling training resources that were consistent in message, adaptable to a school s needs, and, most importantly, compliant with federal loan counseling requirements. Anecdotal evidence supports the idea that conducting in-person versus online counseling is most effective and can positively impact a school s cohort default rate. Based on this premise, several years ago, the Council guided TG s efforts in creating PowerPoint presentations that schools could use to conduct in-person entrance and exit counseling for student borrowers. With limited time and scarce financial and staff resources to create the materials themselves, schools have welcomed the Council s materials for presenting counseling sessions. In addition, TG s account executives are available to deliver these presentations directly to students on behalf of schools. In FY 2012, account executives delivered counseling sessions to over 300 students. Additionally, over 40 administrators benefitted from a Train-the-Trainer presentation about the use of the materials for their students. Most notably, this year, TG supported the Council in revamping these loan entrance and exit counseling materials. TG has now redesigned the PowerPoints to include new highly stimulating graphics, workbooks, and group games and activities designed to engage the student borrower in learning about key loan concepts and responsibilities. 4 Council for Student Financial Success in Higher Education Annual Report 2011-2012
Also, forming part of the loan entrance and exit counseling suite of materials are two recently released intermediate student loan counseling modules, Know What You Owe: Tracking Your Student Loans and Plan for Success: Preparing to Fulfill Your Student Loan Commitment, which serve to reinforce concepts that first-time borrowers learn in entrance counseling. Since their release in fall 2011, over 50 financial aid administrators have received training on these modules. The Council continues to promote the modules and create opportunities to train school administrators on them. Expanding Financial Literacy Education This year, TG and the Council celebrated the launch of two new modules for the TG Financial Literacy Program. The Council and TG co-developed two modules which serve to educate students and families about the costs associated with going to college and the financial resources available to help defray those costs. These modules stand apart from the rest of the modules in the program, in that both student financial aid and financial literacy principles are woven throughout the material. The first module, College Costs: More Than Tuition provides an overview of the expenses and income that could be incorporated in a college student s spending plan. The module also focuses on the expenses into an institution s cost of attendance, other expenses, and different sources of support, including financial aid. The second module, Investing in Undergraduate Education: Costs and Resources, provides key information to help parents and students understand the value and benefits of a higher education with key information about the true costs of attending college, and the importance of maximizing the use of grants, scholarships, and installment plans before considering student loans. The module also provides an in-depth overview of the types of student loans and the differences between federal and private loans. Council for Student Financial Success in Higher Education Annual Report 2011-2012 5
Research Publication, Balancing Passion and Practicality: The Role of Debt and Major on Student s Financial Outcomes In line with its mission of helping students make informed decisions about borrowing, the Council stays abreast of current borrowing trends, challenges, and issues that students face as they prepare to go to college. Some of the challenges that students face today include the continued increase in college costs along with a scarcity of financial aid resources to help mitigate those costs. Today, students generally leave college with debt loads that can exceed their first-year salaries. Further exacerbating this situation are today s weak economy and tough job market for college graduates. Many students find themselves in the worst of predicaments high student loan debt and no job. Consequently, this leads many students to question the value of their degree and the whether the degree has been a worthwhile investment for their future. As the Council furthered examined this perception, members identified that there were additional factors to consider when evaluating the payoff of a higher education. As practitioners, the Council concluded that a college education does indeed prove to be a return on investment when adequate career and academic counseling are present, and when combined with proper debt management and student loan education. Towards that end, the Council guided TG s efforts to conduct a study which examines both qualitative and quantitative factors affecting a student s potential earnings and debt load. TG, the Council, and JBL Associates collaboratively conducted, and provided direction and guidance to develop the framework for, the study. As the Council awaits the release of this study later this summer, members expect to promote responsible student loan borrowing and efforts which encourage students to more closely examine their program selection. These are decisions which can significantly impact a student s return on investment and ultimately shape a student s perception of the value of a higher education. Ultimately, TG and the Council expect that this report will serve as a resource to help policymakers, students and families, and practitioners (including not only college financial aid administrators but others that affect students borrowing habits) make better informed decisions. 6 Council for Student Financial Success in Higher Education Annual Report 2011-2012
Student Loan Repayment: Fostering Collaboration, Sharing Best Practices, and Training Professionals The Council has supported the TG Annual Training Conference for years; this year was no exception. Council members not only participated in TG s Conference (as moderators, presenters, participants, and panel experts in the Conference s Default Aversion Track) but also contributed to the agenda by extending training opportunities to all participants. TG welcomed the Council s active participation and gave Council members the opportunity to spread their mission of promoting default prevention and also promote newly developed resources in student loan counseling and financial literacy. Sessions sponsored and supported by the Council included the following: A Dialogue on Student Loans: Promoting Repayment, presented by Terry Bazan, Bill Spiers, Melet Leafgreen and TG s Maria Luna-Torres, with an overall session score of 4.6/5.0 with 46 participants. Balancing Passion and Practicality: The Role of Debt and Major on Student s Financial Outcomes presented by members of TG s Research and Analytical Services Department and moderated by Council member Dana Mingo. With over 58 participants, this session had the highest number of attendees among all sessions at the conference. Train-the-Trainer Modules: Know What You Owe and Plan for Success, presented by TG s Maria Luna-Torres and moderated by Debbie Urias. The session was rated with an overall score of 4.7/5.0 by a total of 14 attendees who received training on the modules. Train-the-Trainer Modules: College Costs and Investing in Undergraduate Education, presented by TG s Financial Literacy Consultants. The session received a score of 4.9/5.0 by a total of 14 participants. Council for Student Financial Success in Higher Education Annual Report 2011-2012 7
Looking Ahead As the 2011-2012 business year comes to a close for the Council, its members kick off the new year with an annual planning meeting. During this meeting, TG and the Council take the opportunity to assess past initiatives, celebrate accomplishments, and brainstorm ideas for future initiatives that focus on advancing successful student loan repayment. Along with new ideas, the Council also welcomes newly elected members to its annual planning meeting. TG recognizes that the professional experience of its membership is what makes possible the creation of relevant, timely, and rich-in-content resources. Member List Maria Luna-Torres Liaison to the Council, TG Melet Leafgreen (co-chair) Texas Christian University Bill Spiers (co-chair) Tallahassee Community College Lynn Barnes Texas A&M University Terry Bazan Austin Community College Dean Bentley Emory University Joyce Cavanagh, Ph.D. Texas AgriLife Extension Service Mike Fuller The First Marblehead Corporation Jeannie Gage Texas A&M University-Corpus Christi Raul H. Lerma El Paso Community College Dana Mingo Dallas County Community College District Christopher Murr Texas State University Juan Antonio Ruiz San Antonio Credit Union Brian Sunshine Formerly with Nelnet Jessica Thomas Formerly with University of Houston Lance A. Teinert Cology, Inc. Debbie Urias Brazos Higher Education Service Corporation, Inc. Phillip Wambsganss North Texas Higher Education Authority, Inc. Ryan H. Law, M.S., AFC University of Missouri About the Council Established in 1997, the Council provides the higher education community with innovative leadership, activities and services that improve the understanding and management of personal and education finance by students and families. In collaboration with TG, the Council establishes relationships with community partners to heighten student and family awareness of the availability of, and responsibility toward, education finance; and works with institutions, associations, and other stakeholders to develop, implement, and evaluate approaches for information dissemination, financial education and debt management practices and programs. 8 Council for Student Financial Success in Higher Education Annual Report 2011-2012