Boston University Financial Education Task Force

Transcription

1 Boston University Financial Education Task Force Convened By: Boston University Center for Finance, Law & Policy

2 BOSTON UNIVERSITY FINANCIAL EDUCATION TASK FORCE Convened by: BU Center for Finance, Law & Policy Principal Investigators: Aaron Stevens, Carolynn Tomin & Eldon Strickland: CONTENTS I. INTRODUCTION II. PROPOSAL PLAN & ACTIVITES (1) Program Overview: An Innovative and Engaging Student Learning Experience (2) Boston University s Commitment (3) Coordination with Existing BU Programs and Resources (4) Data and research (5) Engaging the Community III. RESOURCE NEEDS BU Center for Finance, Law & Policy Financial Education Task Force, Page 1 of 8

3 I. INTRODUCTION Boston University ( BU ) is a large private research university with 16 schools and colleges, over 33,000 undergraduate and graduate students, and over 250 fields of study. With such academic diversity, BU is an excellent environment in which to develop wide-reaching educational resources and to assess their impact. Across the campus of BU, there is significant individual and institutional support for enhancing graduate and undergraduate financial education resources and programs. BU s faculty and staff recognize that many students are not adequately prepared for making the many financial decisions that they will encounter while in school or after graduation and throughout their adult lives. In addition, many individuals get financial advice from employers, the media, and financial advisors. While these sources of information can be beneficial, often these do not strictly follow evidence-based analysis. And a conflict of interest can arise when the person or firm providing the information or advice has a financial interest in the actions taken in response to that advice. Therefore, financial planning and preparedness should begin as early as possible so that students can make wise choices when considering an advanced degree, acquiring credit cards, managing debt, saving for retirement or addressing the many other financial issues they will face. To coordinate efforts and explore how best to prepare well informed and therefore more empowered BU students and graduates, in the fall of 2012 the Financial Education Task Force ( Task Force ) was convened under the auspices of the BU Center for Finance, Law & Policy ( CFLP ). Members of the Task Force (listed below) include faculty and staff from across the BU campus and bring extensive substantive, technical and strategic expertise. The plan generated by the Task Force is to create online financial education modules to which all BU students will have access, and which can be bundled to create a certificate program. To ensure an engaging learning experience for students, modules will make use of stop-action videos tutorials, quizzes, educational games, and other online resources. In doing this, the Task Force will review and assess existing financial education programs and resources for students, and enhance and promote these along with newly developed programs and resources. This also includes enhancing student outreach, leveraging existing BU collaborations, and sharing best practices and materials with appropriate community partners. Once the modules and certificate program has been developed for BU students, the Task Force intends to provide these resources beyond BU. The Center for Finance, Law & Policy will contribute financial resources to develop the first modules in order to demonstrate the type of program envisioned. II. PROPOSAL PLAN & ACTIVITIES (1) Program Overview: An Innovative and Engaging Student Learning Experience The Task Force will develop financial education resources that address the topics outlined below. Resources will include various online tools including stop-action video tutorials, games, quizzes BU Center for Finance, Law & Policy Financial Education Task Force, Page 2 of 8

4 and other materials. This will be combined with classroom sessions to create an engaging student education experience. a) Content. The content for the modules is derived from the basic principles of personal financial planning and proven money management techniques. The course will apply the economically acclaimed financial life-cycle planning model as a framework for evaluating financial decisions. Outlined below are the topics that will be addressed in the noncredit certificate program. Year One: Your wealth and your money 1. Overview of the economic life-cycle a. Income, consumption and savings b. Relationship between savings and assets 2. Human capital and how to invest in yours 3. Cash flow management a. Income and expenses (fixed and variable) b. Budgeting 4. Credit/debt management a. Credit cards, debit cards, credit scores b. Consumer protection laws (bankruptcy, fair credit reporting laws) 5. Loans and loan payments a. Secured vs. unsecured loans b. Student loans and repayment options Year Two: Accumulating and Investing Your Wealth 1. Uncle Sam and You: a. Federal income tax, W4, 1040 b. Social Security and Medicate taxes and benefits 2. Where to place your savings 3. Overview of investing: stocks, bonds, mutual funds, ETFs, cash equivalents, real estate etc. Year Three: Personal Protection 1. Risk and risk management 2. Insurance: health, disability, life, property 3. Estate planning documents: will, power of attorney, health care proxy, living will, trusts 4. Investment risks: market, purchasing power, interest rate, liquidity, marketability, reinvestment, tax, exchange rate, business, financial, political BU Center for Finance, Law & Policy Financial Education Task Force, Page 3 of 8

5 Year Four: The Rest of your Financial Life 1. Housing: buy vs. rent/lease, mortgage financing 2. Employer benefits: group medical, COBRA, group disability, cafeteria plans 3. Review of LC model: how to sustain your standard of living to age Retirement planning: Qualified plans, IRAs, Social Security benefits 5. Asset allocation and diversification in the context of your economic lifecycle 6. Types of financial professionals b) Pedagogy An instructional designer will formulate the course content into a highly interactive and visually appealing online format designed to facilitate the student learning experience. Video tutorials, interactive graphics and games, quizzes, and other online tools will be developed to create an engaging educational experience. These online resources will be developed as modules addressing the various topics outlined above. For each module, students are introduced to a topic by reading a brief synopsis of online text, which takes no more than 5-7 minutes to read. This segment is followed by a real-life situation that illustrates the information presented, which creates a framework for understanding the new concept and demonstrates how the knowledge is applied. The illustration may be a written scenario, an interactive graphic or a short video that incorporates the key points that students need to know. This process continues until a topic is fully covered. The final learning outcome for each topic is assessed by having students analyze a financial situation according to the facts presented in a mini-case scenario, and make appropriate financial recommendations. Initially, the modules will be available for students who wish to independently review individual topics. However, in order to create a structured certificate program the online modules can be combined with a flipped classroom model, which re-allocates the use of classroom and homework time. For example, readings, videos, quizzes and other materials are moved out of the classroom, and applications and assignments are moved into the classroom. Students then arrive in the classroom with a good grasp of the vocabulary, equations, and overall ideas that will be applied that day. This model allows professors to provide instruction to a larger number of students, as most of the materials are reviewed outside of the classroom. Some of these techniques are being developed and tested as part of BU s current course offering for applied personal life-cycle economics. Videos produced by students as part of that course demonstrate the potential for using short stop-action videos as teaching tools for financial education. Each video provides a conceptual overview of one topic area in an easily approachable format. As an example, please click here to review this student analysis of the financial implications of living with a roommate. While there is a need for more quality control over content, professional scriptwriting and editing to ensure that the information is correct and presented in an accessible and engaging manner, these student produced videos demonstrate some of the potential for an online course. Additional student produced videos can be viewed here. BU Center for Finance, Law & Policy Financial Education Task Force, Page 4 of 8

6 As a proof of concept, the Task Force is currently developing the first module which will address issues such as definitions of income, consumption, savings, and the relationship between savings and assets. This will allow the Task Force to demonstrate the feasibility of the proposed webbased teaching model, and also assess time and resources that will be needed to create a complete certificate program. Using the flipped classroom model, the classroom sessions can be conducted either in-person or using a distance-learning approach and which will allow instructors to reach more people (i.e., live-streaming in which students can send questions to the instructor and the instructor can respond in real-time). (2) Boston University s Commitment There is tremendous institutional and individual support throughout BU for enhancing student financial education. This support is coordinated through the Financial Education Task Force. a) Financial Education Task Force Members: Timothy Barbari, Associate Provost for Graduate Affairs Zvi Bodie, Professor, School of Management Nancy Coleman, Director, Distance Education, Metropolitan College Cheryl Constantine, Director, Financial Aid, School of Law Janelle Heineke, Chair, Department of Operations & Technology, School of Education, Director, Center for Excellence in Innovation & Teaching Cornelius Hurley, Director, Center for Finance, Law & Policy Steven Jarvi, Associate Dean, Student Academic Life, College of Arts & Sciences Laurence Kotlikoff, Professor, Economics, College of Arts & Sciences Elizabeth Loizeaux, Associate Provost for Undergraduate Affairs Christine McGuire, Associate Vice President, Enrollment and Student Affairs Marcel Rindisbacher, Chairman, Finance Department, School of Management Ruth Shane, Director, Public Schools Collaborative, School of Education Aaron Stevens, Professor, Computer Science, College of Arts & Sciences David Stolow, Professor, Director, Public and Nonprofit MBA Program, School of Management V. Scott Solberg, Associate Dean for Research, School of Education Eldon Strickland, Distance Education, Metropolitan College Carolyn Tomin, Director, Financial Planning Programs, Metropolitan College Julie Wickstrom, Director, Financial Assistance (b) Support from Boston University Leadership. Elizabeth Loizeaux, the Associate Provost for Undergraduate Affairs, has expressed her commitment to enhancing student financial education. She is also highly involved in improving delivery of such resources, as evidenced by her position as co-chair for BU s Council on Educational Technology & Learning Innovation. Timothy Barbari, the Associate Provost for Graduate Affairs, is equally committed to enhancing student financial education. Drs. Barbari and Loizeaux together form the nucleus of academic affairs oversight for BU. They share administrative support staff and are partners in advancing initiatives and programs that affect all students, from program assessment and review to teaching and learning initiatives. Both bring BU Center for Finance, Law & Policy Financial Education Task Force, Page 5 of 8

7 prior experience in each other s domains from other institutions, enhancing the collaborative nature of their work. b) Institutional support from within Boston University: Boston University Online. Boston University Online is a unique collaboration between the Office of Distance Education and faculty members throughout the many Schools and Colleges that comprise Boston University. As part of Boston University Extended Education, the office consists of a team of instructional designers, video producers, and support staff who specialize in online education. The Office serves as a resource for Schools and Colleges that seek to develop online programs, and works closely with faculty to ensure that the Boston University Online experience is of the high caliber for which Boston University is regarded throughout the world. Center for Excellence & Innovation in Teaching (CEIT). CEIT was established in 2001 to promote and support exemplary teaching, to facilitate the continued professional development of faculty as teachers, and to introduce new faculty to the culture of excellence in teaching at Boston University. The Center provides a forum for discussing the knowledge, tools, and spirit of inquiry that are central to the teaching and learning processes, and cultivates teachers who can transmit their own passion for inquiry and curiosity about what remains to be discovered. The Center encourages teachers to motivate students to participate actively in their own education and to become lifelong learners. Center for Finance, Law & Policy. The Boston University Center for Finance, Law & Policy practices an interdisciplinary and collaborative mission and methodology to educate, analyze, discuss, recommend solutions and otherwise address the critical financial, regulatory, and policy challenges of the day as those challenges impact the national and global financial system, the larger economy and society at large. Council on Educational Technology & Learning Innovation (CETLI). CETLI is a University-wide group charged with discussing key assertions about the potential role of educational technology both in our on-campus, residential programs and as a means for reaching new learning communities via synchronous and asynchronous technologies. c) Student Outreach and Student Organization Support: Students will be recruited from multiple programs and organizations to participate in surveys, pilot programs, and the final certificate program. Undergraduate students can be reached through various student organizations, as well as through programs such as the Boston High School Scholars Program and the Community Service Scholars Program. Combined, these programs generally include 130 or more students from Boston s low-income neighborhoods. Students participating in these programs come from a variety of cultural and economic backgrounds and are primarily first generation college students. Students in these programs are enrolled across the 16 different schools and colleges at BU. The individuals who oversee these programs are members of the Task Force and will coordinate outreach to their respective students. Student led organizations will also collaborate with the Task Force. Throughout the academic year, the Center for Finance, Law & Policy coordinates with multiple graduate student BU Center for Finance, Law & Policy Financial Education Task Force, Page 6 of 8

8 organizations, including the Public & Nonprofit Management Club and the MBA Finance Club. Other student groups will also be invited to participate directly in the proposed programs. (3) Coordination with Existing BU Programs and Resources Following the completion of the project and following the review of findings, the Task Force will review BU s existing financial education resources and programs to determine how best to enhance online materials, in-person workshops, for credit course offerings, and other resources. Similarly, BU will also review and enhance methods for promoting financial education resources and programs to students. BU will ask all student organizations to include links on their web sites to existing and newly developed resources. The Associate Provost for Graduate Affairs, Timothy Barbari will ask to be invited to student organization meetings annually to discuss financial education and available resources. Through BU s Financial Assistance office, numerous online financial education resources are available to graduate and undergraduate students. This includes the Smart Money 101 website ( which provides tutorials on student loan repayment, budgeting, credit cards, credit scores, identity theft & scams, and other critical issues. Smart Money 101 is a firm foundation on which to review existing materials, build additional resources, and develop a more active and coordinated strategy of student outreach. Financial education workshops are also offered to all students throughout the year. Offered in-person, these workshops address issues such as student loan repayment, understanding a paycheck, credit reports, money management, and student financial aid opportunities. Online materials developed by the Task Force could be used to enhance and supplement these resources. Materials developed by the Task Force can also be used to enhance the First Year Experience course, in which entering freshmen at the College of Arts and Science are encouraged to participate and which currently includes information about financial education. (4) Data and research BU is an affiliate partner in the Enhancing Student Financial Education project sponsored by the Council of Graduates Schools. As an affiliate, BU will have access to data, surveys, and other resources which can be used to assess needs of students and the impact of various financial education programs. In addition, the Massachusetts Financial Education Collaborative (MFEC) is a leader in financial education and has offered to assist with research and data collection. By incorporating the best practices that will be identified through the course of these collaborations, BU will be enabled to develop the highest quality substance and delivery of financial education resources and programs. (5) Engaging the Community Once developed, videos, online lectures, quizzes, and other resources will be adapted and made available to a wider audience as appropriate. This will be done through collaboration with local liberal arts colleges, high school students, and other community partners. Preliminary discussions with local academic institutions have already taken place as part of the Task Force s ongoing BU Center for Finance, Law & Policy Financial Education Task Force, Page 7 of 8

9 efforts. In addition, the MFEC has agreed to assist in identifying and reaching additional community partners. III. RESOURCE NEEDS To develop the modules, substantial resources will be required. The Center has provided limited funds to develop the first module as a proof of concept, and so that the time and resources needed to complete all modules can be more accurately assessed. The final budget will require funds for instructional support (in the form of faculty and staff time to develop the learning modules), developing videos and other instructional tools, and other general IT resources. Some of these costs can be defrayed if suitable partners are identified that can provide instructional design, IT, or other forms of in-kind support. BU Center for Finance, Law & Policy Financial Education Task Force, Page 8 of 8