Administration

Communications

C-SC President Co-Authors Paycheck Partnership Op-Ed Story
Monday, September 26, 2005

This op-ed article was co-authored by C-SC President William L. Fox and Quincy University President Sister Margaret Feldner. It appeared in The Quincy Herald-Whig on Sunday, Sept. 25, 2005.

Partnership teaches youth life-long financial lesson

By William L. Fox and Sister Margaret Feldner

Do you remember your first paycheck? Do you remember what you spent it on? When did you get your first credit card? (That small rectangle of plastic seemed such a symbol of financial independence.)

Getting the first paycheck is one of the joys of being a teen-ager. Having a credit card is empowering. But how many young adults really understand what that paycheck means — or understand how to make the best use of credit? One of the top concerns among parents of high school students is whether their child is learning enough about money management, according to VISA’s recent back-to-school survey.

Parents are right to worry.

One in three high school seniors uses a credit card, and half of those already have cards in their own names. Seventy-six percent of college students pay with plastic — for school supplies, textbooks, food and personal items. In fact, according to a recent survey by OppenheimerFunds Inc., the majority of college students are in credit card debt largely from the use of credit cards to buy personal items including toiletries, clothing and accessories. One third of graduating college seniors has credit card debt of more than $2,200, according to Nellie Mae, the nation’s largest maker of student loans.

This debt is in addition to the cost of a college education and, unlike expenditures for education, credit card purchases generally do not improve a student’s income potential or lifetime financial well-being.

Shann Doerr, director of financial aid at Quincy University, says, “The easy accessibility of credit cards creates concerns for the financial aid administration. In many cases, student loan debt is large enough after graduation; students really need to avoid other debt. QU encourages students to utilize the work study program to develop money management and budget skills by using cash instead of credit. When students are active participants in paying bills, they tend to keep their debt lower."

College-age students — and many others — are often not aware how making a credit card purchase today can impact buying a home, paying off student loans or meeting financial goals in the future.

At Culver-Stockton College, Tina Wiseman, director of financial aid, believes that most college students do not fully understand their financial matters. “At most, 10 percent of our students understand and are involved in financial decisions,” said Wiseman. Parents tend to handle the financial arrangements. Yet upon graduation many students have to manage substantial debt. The national average is $18,000, although C-SC and QU students fall slightly below that amount.

As college presidents, we well understand the pressing need for financial education. We also understand the importance of reaching students at what educators call “the teachable moment” — those times when the need for information is clear and pressing.

That is why we so strongly support the work of the Paycheck Partnership, a home-grown initiative that uses college student volunteers to teach financial management skills to high school students. This week in Quincy and Canton, Mo., the Partners will begin offering “Your Paycheck,” a two-hour financial literacy class for working teen-agers. Students from Quincy University and Culver-Stockton College have been trained at the Federal Reserve Bank of St. Louis to teach the class, which helps teen-agers understand their paychecks, use credit wisely and reach their financial goals through planning and saving.

The Quincy Area Chamber of Commerce is providing administrative support for the program and County Market, The Quincy Herald-Whig, Media Development and others are encouraging young employees to attend the class.
“Your Paycheck” came about as part of an initiative by the U.S. Conference of Mayors asking cities across the country to promote financial education through the National Dollar Wi$e Program. Former Quincy Mayor Chuck Scholz and current Quincy Mayor John Spring deserve thanks for encouraging the partnership, and we applaud the St Louis Federal Reserve for guiding the curriculum. An important goal for the Paycheck Partners is to inspire conversations among teen-agers, parents, educators and the business community about personal financial management. On our campuses — thanks to “Your Paycheck” — the conversation has begun.

“Your Paycheck” sponsors are teaching our young adults a life-long lesson. The message is clear: financial education is a great investment.

William L. Fox is president of Culver-Stockton College in Canton, Mo., and Sister Margaret Feldner is president of Quincy University in Quincy, Ill.