Problem Based Learning: Student Loan Borrowing Principles

Educator utilizes problem-based learning to facilitate student exploration of student loan borrowing principles
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About this Micro-credential

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*Offer valid until 11/30/2017. To receive a gift card, participant must complete all portions of the micro-credential application including the optional survey. Gift cards will be awarded in the form of Amazon eGift Cards emailed to the account specified by the participant. Each participant can receive maximum one gift card. GFLEC reserves the right to withdraw this offer at any time.

Key Method

The educator utilizes a problem-based learning approach to increase student engagement and motivate students to apply student loan borrowing principles to make more informed higher-education decisions.

Method Components

What is problem-based learning?

Problem-based learning is a type of authentic instruction in which teachers act as facilitators to help guide students through student-centered lessons. These inquiry-based lessons use “real-world” problems to develop critical thinking and problem-solving skills, while learning valuable content. Students can use this method of learning to explore how student loan borrowing principles lead to a more informed higher-education decision. By using the problem-based learning approach, students can analyze the financial impact of various scenarios following the attendance of a higher-education institution.

Components of problem-based learning:

  • A loosely structured case or prompt embedded with links to desired learning content.
  • Student-centered learning.
  • Small-group cooperative learning.

Components of problem-based learning for student loan borrowing principles

There are multiple student loan borrowing principles an educator can use to engage students in PBL(see resources section). Problem-based learning for student loan borrowing principles should at a minimum speak to:

  • Filling out the FAFSA
  • Exploring all federal loan options before pursuing private/unsubsidized loans
  • Shopping around if your aid package doesn’t cover the full cost of college.

Suggested Implementation:

  1. Introduce resources and principles that help minimize student loan debt, and lead students to make more informed financial decisions when choosing an institute of higher education.
  2. Students should experience establishing a post-college budget based on student loan assumptions and a recommended budget. Divide the classroom into four groups, and have them assume the following:
    • The national average annual gross salary for those with a high school diploma ($30,000), after accumulating the estimated $11,000 average of student loan debt after attending but not graduating college after two years.
    • The national average annual gross salary for those with a bachelor’s degree ($48,500) after accumulating the stated $26,600 average student loan debt of recent four-year college graduates. Assume the borrowed money originated from a federally subsidized student loan.
    • Below the national average annual gross salary for those with a bachelor’s degree ($40,500) after accumulating twice the stated $26,600 average of student loan debt of recent four-year college graduates, student loan debt of $53,200. Assume the borrowed money originated from a federally subsidized student loan.
    • The national average annual gross salary for those with a bachelor’s degree ($48,500) after accumulating three times the stated $26,600 average of student loan debt of recent four-year college graduates, student loan debt of $79,800. Assume the borrowed money originated from an unsubsidized private student loan.
  3. Introduce students to a student loan repayment calculator, and assume loan type (federally subsidized or unsubsidized private) interest rate national averages. Students use the calculator to estimate the monthly payment of the assumed loan.
  4. Introduce a problem and a budgeting tool; what is the opportunity cost of student loan debt on a future budget? For example, did the student have to forgo purchasing a home or a car because their student loan payments were such a big expense?
  5. Through classroom discussion, each group shares their findings and discusses strategies and resources that aid in minimizing student loan debt, as well as the opportunity cost of student loan debt.

Research & Resources

Supporting Research

Resources

Resources and principles that help minimize student loan debt

Education-based income averages

Student loan repayment calculator

Budget worksheet for college graduates

Submission Requirements

Submission Guidelines & Evaluation Criteria

The items in this following section detail what must be submitted for evaluation. To earn the micro-credential, you must receive a passing evaluation for Parts 1, 3, and 4, and a “Yes” for both artifacts submitted for Part 2.

Part 1. Overview Questions

(150-word limit):

  • How did you illustrate the impact of higher education, such as trade school certification, associate degrees, and bachelor degrees, on future income?

- Passing: Educator describes the steps taken to provide background information about the impact of educational attainment beyond high school on future income.

Part 2. Work Examples/Artifacts

Submit three student work examples that show the completed budgets.

Part 3. Student Reflection

Provide two written reflections from students who participated in the activity. Use the following questions as guidance (300-word limit):

  • Why should borrowers complete a FAFSA prior to making a student loan decision?
  • How do interest rates impact the cost of the loan?
  • Which type of loan is more favorable for the borrower, and why?
  • What are the benefits of comparing the cost of college from one college to the next?
  • How did the various student debt assumptions impact a graduate’s post-college budget? How did this exercise influence how you will approach making a higher-education decision?

Part 4. Teacher Reflection

Provide a reflection of what you learned, using the following questions as guidance (150-word limit):

  • How did this method help students consider making an informed college selection and the financial implications of student loans following college?

Part 5. Survey (Optional)

Please answer a brief survey about your experience teaching personal finance. Your responses will:

  • help us understand barriers personal finance teachers face;
  • and help us improve the resources being offered to personal finance educators
https://www.research.net/r/GFLEC4DP1

We appreciate your help.

Except where otherwise noted, this work is licensed under:
Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0)
http://creativecommons.org/licenses/by-nc-nd/4.0/

Requirements

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