St. Kate's innovative financial literacy program helps undergraduates understand the true value of a dollar.
By GENE WALDEN
Illustrations by KATIE PARKE
Not so long ago, Cassandra Bayerl had little idea where her money was going. It wasn't that the St. Catherine senior was living an outlandish life. She was existing like many modern college students: Instead of keeping track of her expenses, Bayerl was piling up credit card debt, socializing with friends and dining out on fast food.
Then she signed up for "Money Doesn't Grow on Trees," St. Kate's innovative money management program designed to help students navigate the choppy waters of personal finance. One of Bayerl's first assignments for the program was to track her personal spending habits.
Two years ago, Ellen Richter-Norgel, director of student retention, got the inspiration for "Money Doesn't Grow on Trees" when she was attending a conference sponsored by the American College Personnel Association. A representative from North Texas University discussed a new program on money management that his school was offering students.
"I left so impressed that when I got back to Minnesota, I contacted GE Money to apply for a grant to get a similar program started at St. Catherine," Richter-Norgel says. GE Money and ING Foundation have been generous supporters of the program.
A PERFECT MATCH
Keeping a tight hold on the purse strings is particularly important to many students at St. Catherine, where 92 percent of baccalaureate day students receive some type of financial aid and 28 percent of incoming first-year students are the first in their families to attend college.
Many students work part time to keep up with college costs. "A large number of our students participate in our Community Work and Learning program that matches students in service-learning positions off campus," Richter-Norgel explains. "Many other students work in our student employment program and are awarded work-study positions."
But even with financial aid and part-time work opportunities, many students couldn't afford to stay in college. "Finances are probably the number one reason that students leave school," Richter-Norgel says. "That's why we felt we needed to develop a program that could help them budget and spend their money more wisely."
The program has brought a whole new level of financial awareness to the students who have participated. They've learned how to organize their lives, how to budget, and how to distinguish between wants and needs.
So far, more than 200 students have participated in the program, which was launched during the 2007–08 school year. "Money Doesn't Grow on Trees" includes a series of workshops that cover everything from personal budgeting to credit cards to ID theft.
St. Catherine is one of the first colleges in the nation to offer this sort of program, and it is beginning to attract attention and inquiries from educational institutions around the country. Richter-Norgel recently was invited to discuss "Money Doesn't Grow on Trees" at the National Conference on Race and Ethnicity in San Diego. And last fall the program won the Innovations in Student Development Award from the Minnesota College Personnel Association.
The response from students has been overwhelmingly positive. In a survey of participating students last year, 94 percent said they have become more mindful of their spending, 92 percent are more conscious of living within their means and 89 percent have changed their spending habits.
"It has really been empowering as a woman to be able to take control of my finances instead of having my finances take control of me," says Ann Pappas '08, who participated in the program last year. "Before going through the program, I never felt that I had enough knowledge of financial matters to even look at a spreadsheet. Now I'm no longer intimidated by things like that. If I don't have the answers I need, I know where to go to find them."
A VIEW FROM THE INSIDE
Trudy Landgren, assistant professor in the Department of Family, Consumer and Nutritional Sciences, teaches two courses on financial issues: a two-credit class titled "Financial Fitness" and an advanced four-credit course, "Personal and Family Financial Management." She is saddened whenever she hears that a promising student needs to leave school because her finances are falling apart.
"Part of our job as educators is to prepare students to be financially prudent," Landgren says.
Her courses cover consumer decision-making, home financing, risk management, employer benefit packages, estate planning and wills, identity theft and credit reports, among other topics. "We're helping them build a framework," Landgren says. "We do talk about stocks, bonds and mutual funds, but I wouldn't say I teach them how to invest. I just try to get them to that point."
Students are encouraged to change their attitudes toward spending — to separate self-image from the things they own and to view "shopping therapy" for what it is, a short-term fix. "There's never enough money if you spend it the way society expects us to spend it," says Landgren. "And the more you make, the more you spend." Instead, she believes students need to set priorities and make choices. "You can't have everything you want — that's a reality of life. Take cell phones, for instance. Do you really need unlimited texting and Internet access?"
Another point of emphasis is credit card debt. "Credit cards aren't bad," Landgren says, "but they tend to make you think that you have money that you don't really have."
Also, students tend to make only the minimum payment on their monthly credit card bills. "If you pay only the minimum, you'll never get the card paid off and the things you charge will end up costing you twice as much as their original price," Landgren says.
Among the sessions offered during the most recent "Money Doesn't Grow on Trees" series were: "Renting versus Owning a Home," "Financial Aid: What You Need to Know About the Basics," "Understanding the Basics of a Benefit Package," "Everything You Want (and Need) to Know About Retirement Planning" and "Incorporating a Simple-Living Lifestyle."
An internal website has been developed for current students to supplement the program. The site offers resources on money management and details about "Money Doesn't Grow on Trees."
CHANGING STUDENT ATTITUDES
St. Kate's focus on finance is paying big benefits for many of the students who have participated in the classes and workshops.
"I used to love to shop," says sophomore Mai Xiong. "Now I buy what I need — not what I want. I don't have the same interest in shopping."
Since taking Landgren's "Financial Fitness" course, Xiong has cut her credit card debt almost in half. "I'm much more focused on paying off my credit cards and saving for tuition," says Xiong, who works a job on campus.
Pappas didn't rack up any credit card debt during her college years, but the workshop she attended on "The Seduction of Credit Cards" opened her eyes to the problems they can create. "I was surprised at how many students had maxed out two, three or even four credit cards," she says.
Pappas changed her spending habits after taking the "Personal and Family Financial Management" class and attending some of the workshops. "Keeping track of the things I was spending my money on definitely had an effect," she says. "Now when I'm shopping, I always ask myself, 'Is this a want or a need?' — and I make sure I stick with the needs. It has had an impact on my spending."
The power of saving provided another strong lesson, albeit a more positive one. "We learned that if we start saving right now, we'll always have more money than someone who starts saving at 30 or 40," Bayerl explains. "I saw how much I could save and have later in life if I stop spending so much now."
"The program really helped my confidence and my mindset regarding financial issues," Pappas adds. "It helped me take control of my finances. Now I recognize that it's my money, and ultimately it's up to me to make my own decisions on how to use it."