Financial Planning for students

"How will I pay for college?" This question plagues parents and students from the moment that college is a consideration through graduation and sometimes for many years after. The authors of Trends in Higher Education (2007) noted that a low income family will pay almost 40% of the family's income for a student to attend a public four-year school. The cost attendance rose dramatically, by over 33%, in ten years, according to Trends in Higher Education (2007). With this dramatic increase, it is no wonder that parents and students are concerned about the impact of college attendance on a family's financial well-being.

New Student Financial Concerns

When a family arrives on campus for summer registration, the academic advisor is often the first institutional official to spend time with them. In the advising session, the advisor usually has a list of items that must be covered in the session, none of which include financial issues. Academic advisors traditionally have referred financial questions to the Financial Aid office. However, this is not always necessary.
Holistic academic advising can easily incorporate financial issues, career planning, and major selection; all of which are integral to student success. Unlike other student success areas, such as motivation and time management, students have little control over their financial aid situation. Many students and parents are complete novices to the issues surrounding the financing of a college education; they may feel helpless in the financial aid process. Even though students may do everything they are supposed to do in the process, they often come to summer registration unsure of their ability to pay for college.

If academic advisors are to effectively advise a family about financial issues they need baseline knowledge about how the financial aid process works and the issues associated with funding a college education. Below are some suggestions that can help advisors increase their knowledge about college finances:


Continuing students’ financial concerns

Financial concerns often shift once a student enters college. The initial fear of paying for college is over. Now, the student experiences the freedom of college life and the desire to maintain or gain a certain lifestyle. On the surface, it may appear that college students living on campus should have little or no expenses. However, many students struggle to pay for the wants of college life. Unfortunately, many students turn to credit cards to pay from anything from a pizza at a local restaurant to a Spring Break trip to Panama City Beach.Lawrence, Burczyk-Brown, Christofferson, Fair, Moser, and Tucker (2006) reported on a Louisiana State University a survey in which 70.9% of the students surveyed had at least one credit card. Baum and O’Malley (2003) found that among students with credit cards, 27% use a credit card to pay for college expenses.

Academic advisors can address financial responsibility as a behavior that directly impacts academic success. It is the advisor’s responsibility to work with students to overcome educational obstacles, including financial responsibilities. Below find a list of some of the financial topics that advisors may consider addressing with a student:

The importance of financial responsibility in student success

Financial responsibility is one of the many skills students need if they are to be successful in college and life. Like time management and career decisions, making good financial decisions in college will help students make the transition into the working world. Bad financial decisions in college can impact a student’s life for many years afterward.

Advisors should not be afraid to refer a student to financial experts when necessary; an academic advisor’s responsibility is to show the connection between finances and success in college, not to be a financial aid counselor. Advisors should utilize the resources on their campuses to help students get the financial advice they need to be successful in college.