Classification: Four-year public college or university; Historically Black College or University.

Modules Used:

• Module 1: Get a Grip on Your Finances: Smart Spending for Students.
• Module 3: Work Hard but Smart: How to Be Successful in School and Graduate on Time.
• Module 4: Take Control of Your Future: Finishing School and Repaying Your Loans.

How Used:

• Money-management program.
• Student-appeals process.
• Exit counseling.

Program Description: Financial literacy and default management at Lincoln University have proceeded on parallel tracks. In 2001, the default rate of 13.2 was deemed unacceptable, so the university stepped up its efforts to reduce the rate as quickly as possible. Working with a USA Funds consultant to develop a default-management plan, the default-management counselor learned about USA Funds^® Life Skills^®. She attended a training workshop and subsequently developed a strategy for implementing the program as part of the university's debt-management initiative.

The debt-management initiative incorporates three modules of USA Funds Life Skills into activities designed for all students receiving financial aid at the university. Module 1: Get a Grip on Your Finances: Smart Spending for Students is the foundation of the Money Management Program offered by the student-services-program coordinator in mid-to-late November. This debt-management initiative is advertised campuswide as a social function where students engage in activities that help them prepare for the end-of-term financial decisions. Freshmen take full advantage of this opportunity.

Module 3: Work Hard but Smart: How to Be Successful in School and Graduate on Time is used in the student-appeals process. Students who want to submit an appeal to return to the university must begin by enrolling in a mandatory workshop and completing the booklet for this module. The class, taught several times a year by the student-support-service staff, is a prerequisite for all students entering the appeals process. The completed booklet must accompany the student's request before the appeal is eligible for consideration. Because this strategy has been effective with the appeals process, consideration now is being given to using this module with at-risk students before they enroll.

Module 4: Take Control of Your Future: Finishing School and Repaying Your Loans is offered as part of exit counseling. The session is not limited to seniors; every student who has a loan receives an invitation to this social gathering sponsored by student services. Borrowers attending the session receive cards denoting how much they have borrowed, the salaries needed to begin repayment, and their estimated repayment schedules. Shock ensues as students begin to come face-to-face with their financial obligations.

The university has made great strides in accomplishing its goal of lowering the default rate. The rate has dropped from 13.2 to its current rate of 7.9. The students have gotten to know the staff much better and, therefore, turn to them for help in managing their debt. Staff members indicate that opportunities to counsel students were minimal, at best, before the USA Funds Life Skills program was implemented at the university.

Staffing Requirements: The student-services-program coordinator is responsible for the delivery of all modules used in the default-management initiative.

Recommendations: Institutions need to recognize that education and default prevention go hand in hand. The institution must provide the education that students need to learn to manage their debt. USA Funds Life Skills is an excellent resource for students and staff alike. Those who champion the program initially can expand the impact by increasing the support base in other campus units as opportunities arise. At Lincoln University, the supervisor of the debt-management program has been highly supportive, and now the goal is to train others who can implement the program. Student supporters are important as well. Currently, the student-services-program coordinator relies on student-workers, sororities, athletes and other campus-life leaders to become the "voices" for the program. Incentives, such as food and prizes, are effective in encouraging student participation.

Campus Contact:
Paula Clay, Student Services Program Coordinator
Phone: (573) 681-5056
E-mail: clayp@lincolnu.edu