Undergraduate Coping with Financial Stress: A Latent Class Analysis Kevin Fosnacht Indiana University Center for Postsecondary Research 1 Background • Costs of attending college keep rising • Declining family incomes • Students are financially vulnerable o Lack of assets o Little financial knowledge 2 1
Previous Research • 1 in 3 described their finances as “traumatic” or “very difficult” to handle (ACHA, 2012) • Negative impacts of financial stress o Attrition (Joo et al., 2008) o Lower academic performance (Ross et al., 2006) o Anxiety (McPherson, 2012) o Depression (McPherson, 2012) 3 Theory • Stress and coping o Stress – a bodily reaction to an absence of means or external demand o Coping How individuals try to reduce stress Varies within and between individuals Styles: Emotion ‐ and problem ‐ focused • Student engagement theory 4 2
Research Questions 1. How common is financial stress among first ‐ year students at bachelor’s granting institutions? 2. How do first ‐ year students cope with financial stress? 3. How do the coping strategies differ by demographic characteristics? 5 Methods • Sample o NSSE 2012 – Financial Stress Experimental Set o 6,243 first ‐ year students at 43 institutions • Analyses o Descriptive statistics o Latent Class Analysis (LCA) o Χ 2 tests of latent group membership by student characteristics 6 3
Descriptive Results • 60% frequently worried about having enough money for regular expenses • 59% frequently worried about paying for college • 42% frequently chose not to participate in activity due to lack of money • 32% indicated that financial concerns interfered with their academic performance 7 LCA Results 100% Students endorsing the item 75% 50% 25% 0% How often: How often: How often: How often: How often: How often: How often: Agree: Worried Worried Chose not to Chose not to Investigated Investigated Investigated Financial about having about paying participate in purchase withdrawing working more increasing concerns enough for college an activity required from college hours to pay your have money for due to lack of academic due to costs for costs borrowing to interfered regular money materials due pay for costs with my expenses to their cost academic performance Not FS FS, no impact FS, low impact FS, medium impact FS, high impact Note: FS = Financially stressed 12 4
Class Membership Not financially stressed 31% FS, no impact 15% FS, low impact 20% FS, medium impact 11% 22% FS, high impact Note: FS = Financially stressed 13 Gender 100% 75% 50% 25% 0% Female Male Not financially stressed FS, no impact FS, low impact FS, medium impact FS, high impact Note: FS = Financially stressed 14 5
Parental Income 100% 75% 50% 25% 0% Less than $35,000 $35,000 ‐ $64,999 $65,000 ‐ $99,999 $100,000 or more Not financially stressed FS, no impact FS, low impact FS, medium impact FS, high impact Note: FS = Financially stressed 15 Parental Education 100% 75% 50% 25% 0% High school or less AA or some college Bachelor's Graduate degree Not financially stressed FS, no impact FS, low impact FS, medium impact FS, high impact Note: FS = Financially stressed 16 6
Race/ethnicity 100% 75% 50% 25% 0% Asian/Pac. Black/African Latino/Hispanic White Other Islander. Amer. Not financially stressed FS, no impact FS, low impact FS, medium impact FS, high impact Note: FS = Financially stressed 17 Discussion • Most first ‐ year students evidenced financial stress • Many students responsibly coped with financial stress • The most concerning groups: o Financially stressed, high impact o Financially stressed, no impact • Financial aid does not appear to be working for some students • Next steps 18 7
Thank You! For a copy of the paper, go to: http://nsse.iub.edu/html/pubs.cfm kfosnach@indiana.edu 19 8
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