Ohio State Study Reveals College Students’ Attitude, Knowledge About Finances
Posted By Eliana Osborn on August 20, 2015 at 2:16 pm
Last month, Ohio State University concluded a massive research project on college student attitudes about finances. Nearly 20,000 students across America responded, giving one of the most complete pictures of this group’s financial well-being. The study explored five major areas: student loans, credit cards, financial knowledge, financial future, and financial behaviors.
In terms of student loans, Ohio State’s National Student Financial Wellness Study did not discover any big surprises. 64% of students take out loans, and one-third rely on such loans as their primary financing during college. Private school students are likely to not know how much loan debt they have, even though nearly 70% of all students remember the required counseling about loans from when they first enrolled.
Students at two-year colleges are in the biggest trouble when it comes to credit cards – this group is the most likely to have multiple cards, including one out of twenty with six or more cards. These students are also the most likely to roll over credit card debt each month. However, 43.5% of students report having no credit cards at all, and 47% of those with cards pay off the balance in full each month. As with loans, students at private colleges are the least aware of what they spend or owe on credit cards.
While it may seem that young people today take on debt without thinking about the future impact, the Ohio State disabuses us of that notion. More than two-thirds of students report stress over finances, and 60% of all students worry about how they will pay for their education. That number is even higher at two-year colleges.
High schools may require economics classes, but outside of brief loan counseling, where do college students learn about finances? According to this study, the numbers don’t look good. When tested on their financial literacy with five questions, only three, on average, were answered correctly. Less than one-third of students had received financial counseling or classes, whether in high school or college.
The final segment of the study asked about students’ financial future. Across all types of schools, students are optimistic about their potential earnings. Those without loan debt expect to earn more than other students, perhaps because of their backgrounds. However, all students were cautious about increasing student loan debt and if whether it would actually make a difference in future income.
By periodically assessing college student behavior and beliefs about money, the National Student Financial Wellness Study provides a valuable tool for seeing what is working and what needs improvement when it comes to how we are preparing college students for financially secure futures.