Instead of learning in a classroom, they took notes on the pandemic’s financial lessons.
After getting through the pandemic, students don’t think college is as important.
Wallethub, a personal finance site, recently released their “2022 Student Money Survey.” They found that students don’t think college gave them the personal finance skills they need to be successful. Since the pandemic, 20 percent feel like college is less valuable. Now they’re scared of what their post-grad finances could look like.
“Students are unfortunately not adequately educated about personal finance,” Jill Gonzalez, WalletHub analyst, said in a press release “Schools should have programs in place to instruct students about responsible financial behavior from a young age.”
Learning outside the classroom
Most surveyed students don’t think that college has done enough to educate them about personal finances. But from the pandemic, they learned the importance of emergency savings, avoiding debt, and having a steady job.
Personal finance isn’t usually a required class at college and only about 12 states require high schoolers to take financial courses.
Even as students acknowledge the crippling effects debt can have, they still rely on credit cards when making regular payments. Wallethub found that 49 percent of college students use credit cards as their main payment method while 40 percent use debit cards.
Find out: 7 Easy Ways to Improve Financial Literacy
Not worth the price hike
As graduation approaches, their number one fear is not being able to find a job and their subsequent student loan debt.
“Inflation is making higher education less affordable,” Gonzalez said. “As a result, some people may decide that finding a job that provides a steady source of income is the better option for them, rather than going into debt to continue their education.”
According to this week’s research from Wallethub, student loan debt is the second-largest financial burden to American families, the first being mortgages. Alyssa Dobson – director of financial aid and scholarships at Slippery Rock University – explained why students might decide that debt might not be worth it.
“Some students find themselves so bogged down financially by student loan debt that they cannot achieve other life goals,” Dobson told Wallethub. “Purchasing a home and even starting a family may be out of reach for some students based on their finances, largely impacted by student debt, after they leave school.”
Find out: Is Skipping College Worth It?
Stuck on ramen
If young people continue to see the damages student loans can cause, they might choose to skip post-secondary education. Desiree Zerquera, a professor at the University of San Francisco, questioned how this shift can affect the country long-term. Education is important, but if it becomes too unaffordable, people will choose what’s best for their wallets.
“We have an entire generation saddled with over a trillion dollars in student loan debt, who have pursued employment during some of the most economically difficult and stratified times in recent history,” Zerquera told Wallethub. “People make decisions based on what is good for them personally and not what is good for us all. This is a dangerous shift, and one that has been occurring for decades.”
Dobson explained that students often over-borrow when planning for their college education, only making the problem worse.
Financial education in high schools, colleges, and universities could help.
Find out: The 5 Best and 5 Worst Colleges for Your Money
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Published by Debt.com, LLC
