The Credit CARD Act of 2009 restricts banks from offering credit to people under 21 unless an adult co-signs or the signer can show they are able to make the payment. Credit issuers cannot offer free gifts at campus events (team t-shirts at football games) as inducements to sign up.

For their part, institutions cannot collaborate with credit card issuers to offer institutional merch for credit card signees and the law puts restrictions on cards offered through alumni associations and similar.

The law encourages, but does not mandate, that the institution educate its students on responsible credit and money management. Does your institution do this? Does housing or residence life aid in this program? Let us know.

On a related note, the Talking Stick had a story on aiding students with money management; see that article here: Money Management TS

The researchers found that 46% of students at four-year institutions and 72% at two-year institutions were employed during their initial semesters in college. Four-year students averaged 22 hours a week; two-year students averaged more than 30 hours. The researchers noted that if parental contributions dropped, the students’ working hours increased nominally–not nearly enough to make up the difference. They also found that attending a more expensive institution, or rising fees, did not prompt students to work significantly more. The researchers hypothesize that while many students do pay for their education, they’re doing it after the fact–by taking out loans during college and repaying them later. The structure of a job seems to be a benefit: Students who worked about 20 hours a week had higher GPAs than students who worked more, and students who didn’t work at all.

The National Retail Federation has something to say about this, of course: “The economy is forcing young adults to make hard decisions about which schools to attend, where to live, and what’s really a “necessity” for college,” says Tracy Mullin, President and CEO of the National Retail Federation. “This year, college students are just as focused as their parents on finding good deals and making smart choices with their money.”

Among the choices students are making is where to live. More students are opting to live at home rather than in residence halls or off-campus, according to the National Retail Federation. Of the respondents to the survey, 12.8% said the economy is affecting where their student lives this year. Students living at home will be 58.5% of the college population up from just over 54% last year and 49.1% in 2007. Students choosing to live in a residence hall make up 15.8% of the student population, down from 18%, and students living off-campus are down to 22.4% from 24.3%.

One question was left unanswered by the National Retail Foundation, but NPR came to the rescue: Are parents of incoming freshmen are still baffled by those extra-long sheets? (Yes.)

The Post-9/11 G.I. Bill attempts to fix some of the flaws in the Montgomery plan (a public undergraduate degree in New York state will probably cost more than the same from South Dakota), but of course, this makes it more complicated as well. This Inside HigherEd article gowes through some of the details, and what the military is doing to counsel students-to-be. The Department of Veterans Affairs has a website to explain the benefits as well.

The title subtly hints at the plot: Drowning in Debt: The Emerging Student Loan Crisis is a report from the Washington think tank The Education Sector. Their data is from the National Postsecondary Student Aid Survey. The authors, Erin Dillon and Kevin Carey,  found a slight increase from 2003-2004 to 2007-2008 in the proportion of students who took out loans. This isn’t really the bad news, though; the problem was that Dillon and Carey found that students are borrowing more, on average and that they are using private loan companies considerably more; up to 14% from 5%. The authors blame this on escalating tuition costs, and say the proposed changes designed to make federal grants and Perkins loans more widely available will not help this situation.

The National Consumer Law Center released a report this spring on private student loans, which also sounded the alarm about increasing student use of these services. Private loan servicers are not regulated as heavily as other private loan institutions. In addition, private loans are more expensive, with interest rates ranging from 11.5% to a credit-card-like 19%.

Patricia Steele, a research associate at the College Board, disputed the “hype” in the Education Sector report, saying that half of students don’t use any loans at all. Detractors point out that for the students who do take out loans, the ensuing effects on their lives and society matter quite a bit. Part of the problem seems to be how the numbers are crunched, and how well the students do post-college: Are their student loan payments a small detail as they find jobs and establish themselves financially, or are they burdensome, especially when the borrower is out of work or in other financial straits? This Chronicle of Higher Education article is considerably more cheerful, stating that while 65% of students leave higher education with debt, the average total is $20,000 — a chunk of change, but not overwhelming. About 8%, however, have totals of $40,000 or more.

On the upside, colleges and universities have responded to the economic situation by increasing the availability of institutional financial aid and reassessing pricing structures. As a result, most students are going to the sort of institution they think will be best for them, whether private or public, in-state or out-of-state, according to Maguire Associates, an educational consulting firm. The firm twice surveyed seniors, once to see what sorts of institutions to which they were applying and which they preferred, then again in May 2009, to see how the students’ plans had panned out.

The situation may be different for the younger brothers and sisters of the initial survey group. High school juniors were also surveyed early this year, and will be queried again when college enrollment time is neigh. Maguire Associates reports this group, with their university application process more steeped in the recession, is considerably more uncertain about their future prospects.

Schools are finding savings through attrition of products and services that are no longer popular (phone lines and voicemail), letting the cleaning slide a bit or providing fewer cushy services to students. Some of the money-saving changes might have been made anyway– cutting orientation by one day, challenging students to an energy-saving competition, eliminating cafeteria trays or providing admissions materials online–but they’re also saving hundreds of thousands of dollars.

Some of the money-saving ideas are more quirky than others. The article mentions a “virtual swim meet” between Dickinson College and Bryn Mawr College. The teams swam in their home pools, then compared times. Not meeting face-to-face saved $900.

THE FUTURE OF STUDENT LOANS: House hearing elicits widespread agreement that big changes are coming, and that a single federal loan program would make sense. But left unanswered: Is administration’s plan clearly the best option?:
http://www.insidehighered.com/news/2009/05/22/loans

CREDIT LIMIT: Congress passes legislation that will help shield students from credit card companies’ aggressive tactics, but not everyone is cheering:
http://www.insidehighered.com/news/2009/05/21/credit

LOST MEN ON CAMPUS: Scholars at national conference link issues of identity and masculinity to gender gaps in academic performance.
http://www.insidehighered.com/news/2009/05/22/men

TEST PREP, TO WHAT END? New analysis from admissions group suggests that SAT coaching improves scores, but modestly. But study also finds that modest increases make a difference at many institutions:
http://www.insidehighered.com/news/2009/05/20/testprep

The Chronicle of Higher Education

As with other elements of the declining economy, the effects can cascade. The US Department of Education uses financial data to determine institutions’ eligibility for federal student aid. Some of the debt swaps institutions made to hedge against rising interest rates on their debts have now become problematic, and unless interest rates change considerably by June, these transactions will have to be labeled liabilities in year-end financial statements.

This story, provided to National Public Radio by Youth Radio, illustrates the challenges some students have when facing colleges. For some young people, college is assumed, expected and anticipated. For them, it’s a place to get away from watchful parents and a time to explore careers and interests. But for others, such as Mayra Jimenez , higher education is an opportunity and a risk not to be taken lightly. On one hand, there’s the chance to make a better life for herself and her family. On the other hand, higher education is expensive, and she fears being forced to leave school for financial reasons, without a degree.

In an uncomfortable contrast, this New York Times story points out that in order to financially assist some students, colleges and universities have to get that money from wealthier applicants whose families can pay the full cost of higher education. As a result, applicants who can pay tuition outright are given closer consideration for admission.

Hard times make for greater interest in RA positions. So says a story in the The New York Times. According to the article, applications for 30 RA positions at Seton Hall University, in South Orange, NJ, jumped to 168 this year, from 104 two years ago. Other schools the Times mentioned saw similar increases.  Of course, the compensation–often free room and board, or a combination of discounts on both–is alluring, especially to students who need to cover their own expenses.

But the housing professionals quoted in the article, including ACUHO-I’s president, Norb Dunkel, stress that the job has more long-term benefits, and these outweigh the monetary gains. Given the multiple skills and long hours, RAs earn more in problem-solving, conflict resolution and crisis management than they do in money.

The question of how to recruit and compensate RAs is often on the minds of ACUHO-I members. Discuss the topic with your colleagues in our forums.