COVID-19 Raises Student Anxiety Levels By Presenting Extraordinary Health and Financial Challenges
Students Demonstrate Strong Financial Habits That Could Help Them Get Through These Troubled Times
AIG Retirement Services, a leading provider of pension plans for tax-exempt employers and the public sector, including educational institutions, and EVERFI, the country’s leading innovator in social impact education, announced today the results of a new survey of more than 7,000 students across the country on topics ranging from the impact of COVID-19 on their education, personal finances and mental health.
Impact of COVID-19
The results show that 41% of students feel more anxious about the current school year due to the global pandemic and less than half (47%) say they are ready to deal with their stress and anxiety. Students are also worried about their health and well-being, saying their three biggest concerns with COVID-19 are getting sick (42%), the well-being of their families (39%) and their health. mental (35%).
The high level of uncertainty also has financial implications, with a third (32%) saying COVID-19 has put additional financial strain on their families. To address these challenges, one in four students (23%) have considered or have applied for additional scholarships and grants. Likewise, due to the pandemic, one in five people (21%) have considered or have already taken on additional work to help pay for the cost of college education.
College Students Develop Strong Financial Habits Amid Pandemic
Surprisingly, despite all the new stress and uncertainty, students surveyed this year are showing better financial preparation and better financial habits than in previous years. These improvements in student personal finance habits include:
75% stop spending when cash flow is low, compared to 64% for the 2019-2020 academic year;
72% regularly check their bank account balances, compared to 65%; and
57% still make more than the minimum payment on their credit card, compared to 42%.
For the future, students plan to wear several good financial habits in the future:
Student loans: 76% of college students plan to pay off their student loans on time, up from 68% last year. Similarly, 76% plan to repay their student loans in full, compared to 66%.
Credit Cards: Over the next year, 71% of respondents plan to pay their credit card bills on time, up from 60%. Additionally, 61% plan to pay off their entire credit card bill each month to avoid paying interest, up from 52%.
Budgeting: In the coming year, 53% plan to create a budget to track their spending and savings, up slightly from 48%. In addition, 57% plan to follow a budget to limit their spending, a slight increase from 53%.
“Despite the negative impact the pandemic has had on their well-being, students have shown themselves to be resilient in the face of challenges,” said Rob Scheinerman, President and CEO of AIG Retirement Services. “This generation is demonstrating positive personal finance behaviors that will make a real difference to their future. We hope they emerge from this pandemic safe and healthy – prepared with the financial tools that can serve them well. coming years.”
Many still want the classic college experience
What may come as a relief for universities amid major investments in health and safety measures, most students still seem to want the college experience they signed up for.
Only 5% of students surveyed considered transferring schools and only 10% considered delaying the end of their studies until they could safely return to campus in person. In parallel, only 16% said they plan to stay at home with their parents while they finish their studies, showing a strong preference for building their independence at school.
“The pandemic has raised questions about what the future of a college education might look like, but students have spoken: they still want the classic college experience, the campus and all,” said Ray Martinez, president of ‘EVERFI. “Faced with circumstances that would have been unimaginable a year ago, the students are determined to stay the course and want to make the most of an undesirable situation.”
Areas of concern and financial vulnerability
Although college students appear to be engaging in many positive financial behaviors, the survey revealed some areas of concern that demonstrate financial vulnerability. Two in five students (38%) fear having enough money to last the semester, and 40% of respondents said they would not be able to afford a major unforeseen expense.
Financial debt could become a challenge, as 57% reported having student loans after graduation and 35% reported having at least two credit cards (17% having three or more). Perhaps to settle these debts, a small but significant number of students are considering turning to a payday lender at some point in the next year.
This survey conducted by AIG Retirement Services and EVERFI, conducted from August 28 to September 28, 2020, is a nationally representative sample of 7,099 students from 64 higher education institutions located in 26 states.
About AIG Retirement Services
For more than half a century, AIG Retirement Services has been a leading provider of defined contribution pension plans for tax-exempt and public sector employers, including healthcare, kindergarten through 12th grade. year, higher education, government, religious organizations, charities and other non-profit organizations. AIG Retirement Services has over $ 100 billion in assets under administration, managing thousands of plans serving approximately 1.8 million plan members. It comprises the VALIC family of companies: La Compagnie d’Assurance-Vie à Rente Variable and its subsidiaries, VALIC Financial Advisors, Inc. and VALIC Retirement Services Company. Additional information can be found at www.aig.com/RetirementServices.
American International Group, Inc. (AIG) is a leading global insurance organization. AIG member companies provide a wide range of property and casualty insurance, life insurance, retirement solutions and other financial services to clients in more than 80 countries and jurisdictions. These diverse offerings include products and services that help businesses and individuals protect their assets, manage risk and keep their retirement secure. AIG’s common stock is listed on the New York Stock Exchange.
Additional information about AIG is available at www.aig.com | Youtube: www.youtube.com/aig | Twitter: @AIGinsurance www.twitter.com/AIGinsurance | LinkedIn: www.linkedin.com/company/aig. These references along with additional information about AIG have been provided for convenience, and the information contained on those websites is not incorporated by reference in this press release.
AIG is the trade name for the global P&C, life and pension, and general insurance business of American International Group, Inc. For more information, please visit our website at: www.aig.com. All products and services are written or provided by subsidiaries or affiliates of American International Group, Inc. Products or services may not be available in all countries and jurisdictions, and coverage is subject to underwriting requirements and in the language of the police. Non-insurance products and services may be provided by independent third parties. Certain property and casualty guarantees may be provided by a surplus line insurer. Insurers of excess lines do not generally participate in state guarantee funds and policyholders are therefore not protected by these funds.
ABOUT EVERFI, INC
EVERFI is a global technology company that drives social change through education to tackle the most difficult issues affecting society, from financial well-being and prescription drug safety to driving in the workplace. and other critical topics. Founded in 2008, EVERFI leverages its Software-as-a-Service (SaaS) community engagement platform and has reached over 41 million learners worldwide. Recognized as one of the world’s most innovative companies by Fast Company in 2020, EVERFI drives community engagement in a sustainable way to empower individuals and organizations to make an impact within their communities. Some of America’s top CEOs and venture capitalists are EVERFI investors, including Amazon Founder and CEO Jeff Bezos, Google Chairman Eric Schmidt, Twitter Founder Evan Williams, as well as Advance, Rethink Education, Rethink Impact, The Rise Fund and TPG Growth. To learn more about EVERFI and how you can #answerthecall, please visit everfi.com or follow us on Facebook, Instagram, LinkedIn, or Twitter @EVERFI.
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