THE IMPORTANCE OF FINANCIAL LITERACY PROGRAMS AT A SMALL NONPROFIT UNIVERSITY FOR NEW AND UNDERREPRESENTED COLLEGE STUDENTS
Date
2021-05
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Abstract
College administrators and the federal government have perceived the need for financial literacy education programs. Financial literacy is a complicated subject. University administrators understand the need to incorporate financial literacy programs in their college curriculum. A college degree opens up employment opportunities, but college graduates are entering the workforce with a tremendous amount of college debt. The average college student loan debt for the class of 2018 was $38,000.00 (Friedman, 2020). Starting a career with this amount of debt could impact home-buying potential and other investment opportunities for college graduates. It is very essential to equip college students with an understanding of financial literacy to help them prepare to make better financial decisions.
This study examined the financial literacy levels of first-time first-year College students and first-generation students at a small not-for-profit University. This study also examined the impacts of their financial efficacy and financial behavior planning of the participants. Mandell's (2008) Jump$tart college student survey was used to measure the participants' financial literacy levels. The financial literacy score of the 328 participants of this study was about 48 percent. This score is below the average level of financial literacy defined by Mandell (2008), 50 through 70 percent. Lown's (2011). Self-Efficacy Scale was used to measure the personal efficacy of the participants. The students' average self-efficacy score was 16 out of 24 possible points, below Lown's mean score of 17 points. Additional analysis of participants FLL and self-efficacy identified significant differences between the groups by race/ethnicity, income level, and first-generation status. Hispanic scored lower than White students in both measures. Students from low-income families scored lower than students from middle- or high-income families in both measures. Finally- first-generation students scored lower also in both measures than non-first-generation students. These findings support previous results and reiterate the need for FL education, especially for disadvantaged students.