BOWIE — U.S. Senator Chris Van Hollen (D-Md.) made an appearance at Bowie State University’s Financial Literacy Day; an annual event focused on helping students begin to build financial independence, on April 17.
“It is really the one course that is really not offered whether in grade school or middle school or high school,” Van Hollen said during his speech. “It is also really not a course offered that much in college, you can take economics and microeconomics or macroeconomics and it’s always good to learn about supply and demand, but when it comes to basic life financial skills, there has been a gap.”
Students, faculty and vendors from organizations such as Navy Federal Credit Union and SECU gathered in the lobby of the Martin Luther King Jr. Communications Arts Center to hear speeches from Van Hollen as well as Bowie State University President Aminta Breaux and Bowie State senior DaRonte Craig.
“Today is about educating students and our entire campus about the need to continue to manage financial wealth and also to manage your resources,” Breaux said as she opened up the event. “And to have your funds work for you, not that you just keep working and working harder and harder, but to work more efficiently, more effectively and to manage your resources.”
Financial Literacy Day is a fairly new program at Bowie State, said Financial Literacy Coordinator Natia Hill. It began about two years ago to get students to start thinking about their finances.
Having worked both as a credit counselor and a financial aid counselor, Hill said she has seen first-hand what happens when people are unaware of how to effectively manage their money.
“I want to make sure that they have that understanding,” Hill said. “Especially since a lot of them will go to live with their parents after they graduate so if we get them the education now, maybe they will be on better footing and have a better understanding of what to do with their funds.”
Although not widely offered in school, Van Hollen said, financial literacy becomes very important after graduation when people are faced with questions such as how to get a credit card, how to know the credit card terms are good terms, how to open a bank account, how to make sure you don’t get charged excessive fees on your bank account and what are the rules for credit ratings and credit scores.
The senator brought up the financial recession of the late 2000s where financial literacy would have been critical because there was a freeze over effect of major financial institutions in the country. That economic contagion spread throughout the country, and it really hit hard everywhere, especially Prince George’s County when it came to property values. People entered into mortgages that were complicated and not sustainable, and companies were able to take advantage of that.
He also brought up the current issue of the student loan debt crisis. According to Van Hollen, there are 44 million Americans with student loan debt, totaling about $1.5 trillion.
Although the federal government passed the Wall Street Reform Bill soon after the recession to alleviate the possibility of mortgage companies taking advantage of vulnerable people, there is work being done to reduce the debt burden on students. Van Hollen emphasized the importance of the students learning financial literacy for themselves as to not put themselves in a position to be exploited.
“It’s really important to empower yourselves, and that’s what this is all about, getting those tools that are necessary to make sure you put together the savings you need,” he said.
The knowledge of managing money and applying for scholarships has benefitted Craig immensely because he will be graduating in May with zero student loan debt.
“Financial literacy is very very important,” he said. “The knowledge of your funds is important. Forbes said that there is on average $4,000 in credit debt on the backs of students when they graduate. More so, students have a student loan debt ratio of about $37,000. I don’t know about you, but that’s a lot of money that I wouldn’t want to pay back.”
Following the speeches, students had the opportunity to break off and speak to the banks and financial advisors individually to learn more about gaining better financial literacy.
Student Rukevwe Sowhe was especially interested in learning about how to pay off loan debt. As they heard from Van Hollen, student loan debt affects millions of people, and it’s important to learn more about “because if you don’t pay it off, it can affect your credit score and interest.”
“It’s all about really just getting our students to be more conscious of their spending, budgeting, managing their finances, especially while they’re in school so afterward when they graduate, they know exactly what to do with their money,” Hill said, “because it doesn’t matter what major you have, if you’re going to have a job, if you’re going to be self-employed, you still need to know how to manage your money.”