There’s no denying that financial literacy is a major concern for college students. The cost of tuition, living expenses, and other school-related expenses has gone up 169% since the 1980s (accounting for inflation)1, leaving even the most successful students struggling to make ends meet.

Though universities are often at the forefront of social change, many of them are not adequately addressing the financial literacy needs of their students.

This can have a direct impact on a minority student's ability to obtain higher education and take part in a wide range of opportunities, weakening campus diversity and inclusion.

Fortunately, financial literacy programs – when implemented correctly – can help universities address this issue.

Financial literacy programs provide resources, tools, and support to students, staff, and faculty so they can better manage their personal finances and tackle the financial realities of a college education.

Through a focus on personal financial education, budgeting resources, and other support for those struggling with their finances, universities can make sure their student body is more diverse and empowered to take part in all the educational opportunities available.

Read on to learn about how your university can boost diversity and inclusion through financial literacy programs.

Financial Statistics

Consider your college's student body, as well as incoming/potential students. You likely know by now that there are many barriers to receiving a college education, with financial aid and student loans being some of the biggest issues.

But not all students are affected equally. Research from Arizona State University has shown that students in the demographics of first-generation, low-income, racial/ethnic minority, and non-traditional are far more likely than their peers to experience financial stress.2

This puts them at a major disadvantage. If they're already grappling with finances, there is much less of a chance that they will be able to pursue advanced education and obtain their degree.

Unfortunately, this pattern is cyclical. A 2018 study from the National Center for Education Statistics found that the children of parents who received an education were far more likely to complete an undergraduate degree than first-generation students.

These students were less likely to finish their degrees and often dropped out due to social and economic issues. The financial barrier to a college education resulted in only 48% of first-generation students completing their undergraduate degree on time (with one-third dropping out after three years).3

Racial Minorities

For racial and ethnic minorities, there is still a significant barrier to a college education and student success – even if their parents are college educated. Minority students are already at a disadvantage, as the median wealth of black families is 10 times less than that of white families.4

This means that many of these students will need to turn to student loans to finance their education. 

While student loans are not necessarily an issue, they become problematic when these students are not equipped to properly manage their student loan debt once they graduate, leaving them with crippling debt payments that they likely cannot afford.

This is statistically proven. An American Economic Association report found that on financial literacy tests, minority students scored significantly lower than their peers.5

To help these students (and, in turn, promote diversity at your school), universities must be proactive in offering resources that can help them manage their finances while they are still enrolled. This is where financial literacy programs come in.

Implementing Financial Literacy Programs

Financially savvy students know how to properly manage their money, reduce unnecessary expenses, and plan for their future. Luckily, universities are in a great position to teach these skills to incoming and current students.

Financial Education Courses

Financial education courses teach students (both current and incoming) about personal finance, budgeting, credit card management, and debt repayment.

By giving students a foundation with which to work, financial education programs can ensure that they are more prepared to handle their finances after graduation without suffering too much stress or taking on loans they cannot pay off. They'll also be able to lower student loan default rates, as well – research has shown financial literacy has a positive effect on tackling this problem.6

Financial Counseling and Mentorship

Students who are already in deep debt or struggling to make ends meet may require financial counseling and mentorship.

Universities can offer such services run by experienced professionals, allowing students to address their specific financial needs and get on the path toward success without having to take on even more loans.

Offering entrance and exit loan counseling can also help students make smart borrowing choices. Having a place for students to turn when trying times come ensures that they can remain in school and eventually pursue their chosen career – without getting deeper into debt. 

Online Financial Literacy Tools and Resources 

In addition to coursework and mentorship, universities can offer online resources such as budgeting worksheets, calculators, credit score estimators, debt repayment plans, videos, and articles about personal finance topics.

All of these are invaluable for incoming students and teach them how to manage their money from the start of their college careers. 

iGrad's financial literacy platform is the perfect solution – students can access an array of information, personalized assessments, and tools that will help them make smarter financial decisions.

In order to increase diversity and inclusion at the university level, it’s essential to ensure that all students have access to resources that can help improve their financial literacy.

By offering a comprehensive financial literacy program with budgeting tools, counseling sessions, courses, and online resources – such as iGrad’s financial literacy platform – universities can make sure all their students are empowered with the knowledge they need to succeed.

Contact us today for more information on how your university can boost financial literacy and create a stronger community built on understanding and inclusive practices.



1 - https://www.forbes.com/advisor/student-loans/college-tuition-inflation/

2 - https://www.apa.org/education-career/ce/financial-stress-college-students.pdf

3 - https://nces.ed.gov/pubsearch/pubsinfo.asp?pubid=2018421

4 - https://www.brookings.edu/articles/examining-the-black-white-wealth-gap/

5 - https://www.aeaweb.org/conference/2019/preliminary/paper/3ihGHf9h

6 - https://cepr.org/voxeu/columns/financial-education-effective-and-efficient