Student success and retention are key objectives in UMKC’s Strategic Plan. A number of measures are being initiated to achieve these goals, including measures to reduce loan defaults and to improve financial literacy.
At UMKC, students most likely to default on their loans are freshmen and sophomores who are Pell Eligible and have left the university. (Pell Eligible students accounted for 54% of all defaults.) The next most likely group of defaulting students leaves school prior to graduating. Overall, Pell Eligibility and lack of degree attainment are the two greatest factors related to delinquency and default.
To address these issues, the university has developed a Default Prevention plan, funded through the Missouri Dept. of Higher Education, focusing on financial literacy and increased retention.
Studies show that students from lower socioeconomic status groups tend to lack money management skills. For this reason, a key component of the Default Prevention plan is our Financial Literacy Program (FLP).
A few of the program’s measures are ongoing counseling, mentoring and financial literacy education for students before, during and after their college careers. The program benefits both our students and the university: Students benefit from increased campus collaboration, counseling and money management skills, and the university benefits by graduating fiscally responsible community members.
UMKC’s Financial Literacy Program
Financial Literacy Workshops
Two types of Money Management workshops have been created. The first aims primarily at freshmen and sophomores, and emphasizes the smart use of money, credit, budgets, and includes student loan information. This workshop is included in the Coaching Programs semester calendar for Academic Success workshops.
The second workshop aims primarily at seniors, and focuses on budgeting, loan repayment, and credit. This workshop will be incorporated at the end of each semester.
First Year Courses
Many first-year courses already have a money management unit within the course. Moving forward, course instructors will have the opportunity to have guest lectures on financial literacy.
Money Management Workshops
Money Management workshops are a series of opportunities throughout the semester that are open to all students campus-wide. These workshops, facilitated by Peer Leaders, cover pertinent topics from economic education to personal financial fitness.
A financial literacy website has been constructed. During the next year, it will become more interactive and will include a page where students can take a financial literacy quiz. Using the quiz will have a number of advantages. For example, it offers our students a tool for self-reflection. An online quiz being linked with other money management resources provides a springboard into other personal-finance learning opportunities.
Through a collective effort of Financial Aid counseling, educational seminars and interactive website resources, UMKC hopes to better educate our students on the proper use of money and credit which will result in lower default rates and increased retention.