Many financial planners, educators, banks and credit unions are working hard these days to make certain that busy high school and college students and young adults possess the financial knowledge to make good decisions about such matters as how far to go into debt, whether to sign up for a credit card, how to establish a good credit rating or how much college loan debt they should incur.
Beginning with the high school graduating class of 2008, the Utah Legislature passed a law requiring juniors or seniors to complete a mandatory semester course in personal financial literacy.
According to Julie Felshaw, director of Economic Education at the Utah State Office of Education, students in those classes learn about financial planning and goals, career and education planning; money management including credit score; the way to use of money, and the use of credit cards and savings accounts. Students also learn about saving, investment and retirement.
"Kids may or may not be paying attention," said Felshaw. "We are planting seeds and hoping that they learn to ask questions, make comparison and decide 'this is what I want to do.' When you take those steps, we hope they think back to the class and what they learned."
In 2009, realizing that rising student loan debt and financial pressure was the number one reason why students were dropping out, Student Affairs at the University of Utah created a Financial Literacy Needs Assessment where students were asked how they were doing with their personal finances.
The survey revealed that only 38 percent of Utah students even used a budget. The students wanted a personal money management resource on campus to give them information on budgeting, credit cards, taxes, savings, spending and individual counseling.
That led to the establishment of the U's Personal Money Management Center in 2011. It provides a confidential atmosphere where students gain have access to accredited counseling services, classes and financial tools.
Ann House, the coordinator of the center, offered some surprising observations.
She said surveys have shown that credit card debt is not a major problem at the University.
"This generation is quite savvy with cards," said House. "The banks and credit unions have done a great deal to educate students about that first card."
Part of the reason for that is that a federal Credit Card Act that became effective in 2010 requires that any credit card application filled out by a person under the age of 21 needs the signature of a cosigner older than 21 or to demonstrate "independent means of repaying any debt incurred.
"Of course, because many college students don't work, that is why they most co-sign with parents," said Heidi Prokop, Zions Bank Communications Manager. "When applying for a co-signed card, parents can request a lower limit for their young adult children, so they can get in the habit of using and repaying the card and avoid overextending themselves."
Prokop said that while Zions Bank does not offer a formal credit card counseling program for young cardholders, it offers a major outreach effort each October during National Get Smart About Credit Day. In 2013, Zion Bank employees taught 8,427 high school students in Utah and Idaho about using credit wisely.
House said about 45 percent of University of Utah students take out student loans. She sees more abuse of student loans than with credit cards. She advises students that they should not take out any more in student loans than they plan to earn in the first year of work.
"Many students don't have a plan, other than just getting a degree," she said. "They have no plan for what they are going to do after college when they get a job and go to work. They need to learn what jobs are out there and plan on paying back student loan debt if they are taking out loans."
Other companies offer different strategies for taking out student loans and avoiding credit card debt.
David Shimko, the CEO and co-founder of CreditCircle in Salt Lake City, watched his five grown children going through different credit issues. As a professor of finance for 20 years at schools such as USC, Northwestern and Harvard, he also saw first-hand some of the challenges in educating students about finances. He found many students simply had no knowledge about credit or how it works.
His idea was to help students avoid loans or dealing with banks by relying more on family and community networks. He called his plan a variant of co-signed loans.
In some cases, under Shimko's strategy, a parent or grandparent would work with a student and his company to get a loan and then receive a small bit of interest back, something that can be valuable for seniors on a fixed income. Instead of dealing with a bank loan, grandparents or parents take risk. Sometimes CreditCircle's plan can reduce interest rates from 18 to 10 percent.
On its website, the company said it helps students manage debt by working with friends and family to build up credit and have a plan to pay off debt quickly. Another tab offers information on the advantages for family members who wish to participate.
Drysdale said she thinks the biggest way to help students is to simply get the word out.
"It sounds silly, but just getting the word out busy college students is they best thing they can do," said the University of Utah student. "We need options tailored to students including low interest rates and low fees.
"The paradox is that students are worried about finances, but they are so busy and overwhelmed there there is not the time to do research that could make their life easier."