As professionals in the education sector, we have a responsibility to ensure that our students receive a quality education during their time at university. Financial education is rarely part of a course curriculum, but for those of us who are passionate about supporting learners in reaching their full potential, a lesson in financial concerns is well worth the time. Below are three financial considerations that university students could benefit from understanding.
Student Loans and Other Funding Options
For many students, access to higher education is made possible through a private or government loan. Borrowing funds for university is a big commitment, so students must know how to manage them sensibly and effectively. Topics to cover include understanding the terms and conditions of a loan agreement, what students are entitled to, and the potential consequences of not meeting repayment obligations. Covering alternative funding options, such as grants and scholarships, is also useful.
Educators should be aware that some students will be heading abroad to complete a semester or continue on to further studies. Educating students about how student loans work in other countries is crucial to ensuring they’re given the best possible start to their academic careers.
[RELATED: How I Introduced My Students to Personal Finance]
Implications of Debt
Being at university is often the first time a young person experiences debt as a result of borrowing money to fund their studies. Because loans are utilized by such a large proportion of the student population, it’s common for learners to adopt a somewhat nonchalant attitude towards their financial commitments.
As educators, it’s important to help students understand the gravity and significance of their financial decisions and actions, including the short—and long-term effects of falling into debt. In addition to discussing student loans, it’s equally important to educate students on using credit cards sensibly by discussing interest rates, credit scores, and the potential legal implications of owing money to a creditor.
Budgeting for Financial Wellbeing
While students should be made aware of the dangers of financial irresponsibility, it’s crucial to equip them with the tools they need to manage their money effectively. Budgeting is essential for financial well-being, and educating students on how much money they should be putting away each month—and the kinds of savings and investments they should be making—will help to set them up for a financially secure future.
Sharing budgeting resources can be helpful, allowing students to refer back to key information throughout their time at university. Every student’s budget will be different, so equipping them with a formula that can be adapted to suit their individual circumstances is essential.
Supporting Students to Flourish and Thrive
Student loans, debt, and budgeting are all important topics that students can benefit from understanding early on. As educators, we have a unique opportunity to support young people in the classroom so they can go on to flourish in all other aspects of their lives.
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“For many students, access to higher education is made possible through a private or government loan. Borrowing funds for university is a big commitment, so students must know how to manage them sensibly and effectively.”
I argue that the most sensible thing is not to borrow in the first place.
What sane banker would loan an 18-year-old (or anyone) money to go gamble in a casino. But that’s essentially what young people are doing, and at least there is a state gaming commission to keep the casino somewhat honest.