Vivi Friedgut, Founder and CEO, Blackbullion

When the previous Education Secretary, Damian Hinds, flagged that young people need more help than ever with independence, it felt like he was arriving a little late to the party.

Announcing the introduction of “Leapskills workshops” to prepare college students for independent living, he highlighted how worries about financial pressures are compromising student wellbeing and mental health.

Thing is, we already knew this: financial difficulty is the number one predictor of student attrition, and 64% of students say financial anxiety affects their mental health.

And yet, working with our university partners every day, we see how real-world money skills can be transformative in a student’s life, providing the confidence and capability needed to help young people design the life they want. It goes beyond graduation too – it’s a life skill in its truest form.

So, with these clear indicators, isn’t it time that we, as education leaders finally make financial education a priority? And what’s preventing us from building out meaningful financial capability strategies that engage and empower students?

The case for financial education

The case for financial education is more critical than ever, as more and more students question the value of higher education. YouGov research shows that 35% of students who graduated between 2010 and 2017 believe that the costs of going to university simply “aren’t worth it.” This means that any effective recruitment – and retention - strategy has to include the financial case for attending university at the outset. And it needs to be underpinned by a robust financial education to ensure it’s accessible to more students.

There’s more. The modern workplace increasingly requires a variety of skills that sit outside of traditional academics: we’re all too aware how employability skills are a real challenge for business. England has one of the lowest financial literacy scores globally. According to new research from UCL Institute of Education (IOE) and University of Cambridge, one-in-three adults in England and Northern Ireland are unable to work out the correct change from a shopping trip. I’d argue that – and I know many student finance teams agree with this view - there’s a strong case for making financial capability part of the core curriculum.

Widening participation through financial capability

Where financial education comes into its own is widening participation – a pillar high on all university agendas right now. Its track record is particularly powerful for vulnerable student groups, primarily younger populations - prospective and first year students- or those without strong family support, such as care leavers and first in families.

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We’ve identified a distinct lack of priority placed on second year students in particular, which tend to be the ‘abandoned middle child’. This despite the growing financial pressure that the second year brings – higher rent, fewer introductory offers, possible cumulative credit card debt. As a team, Blackbullion is on a mission to broaden the reach of financial programmes to go beyond first year cohorts alone. Scaling financial capability outreach needs to happen sooner rather later and reach a broader cross-section of the student population and, vitally, to pre-empt financial challenges.

Measuring the impact of financial education

When it comes to the organisational barriers to proactive financial education strategies, there’s the low –or complete lack of- buy-in from senior management to get past. And yet when I speak to VC and senior management customers and explain how Blackbullion changes students’ lives, they immediately get the value of a strategic fin-ed programme. But they need to see this evidenced.

Historically, financial education has been workshop based which makes measurement difficult. The challenge, however, is deeper rooted: our recent research looking at financial capability across universities showed that currently, just one out of four universities measure the impact of financial capability on student retention. And it’s this that needs to change to be able to drive the clear value back to decision-makers, whatever mix of criteria you start with, whether it’s a reduction in applications to hardship funds and emergency loans or the extent to which students actively engage with activities.

Developing a financial capability strategy

So where do you start when you’re looking to develop a financial capability strategy?

From our customers, time and again, we see a direct correlation based on budget and the resources available. There’s no single recipe – every strategy needs to relate to the unique needs of your institution’s individual student body, whose financial backgrounds vary on a case by case basis.

Where we see real success in developing student financial skills, is when institutions take a multi-touch approach to increase their reach within the student population. Welcome Week stands, workshops (including those with third parties such as Citizens Advice and Natwest), parents workshops, campaigns like National Student Money Week (organised by NASMA), one-on-one support and working with student money mentors are all powerful starting points.

Our research found that 70% of surveyed universities are trying to make at least some of the financial capability learning mandatory, asking students to complete a learning module, or a budget calculation, as part of the hardship award application process. We’re also seeing some institutions look into including financial modules into their welcome week orientation, while others are exploring making the financial skills part of the official curriculum. 

There are many institutions out there getting great results by building an integrated financial education strategy, with the right resources and support in place. Now it’s time to go further. In a climate where more than ever students are questioning the value of degrees, we need to enhance the university experience. Financial capability and confidence goes far deeper than the university timeframe – it’s an essential skill for life, and one we need to champion more than ever.

Vivi Friedgut, Founder and CEO, Blackbullion, the award winning edtech company transforming students’ lives through financial literacy

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