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The Financial Lives of College Students - US - March 2015

Published By :

Mintel

Published Date : Mar 2015

Category :

Banking

No. of Pages : 135 Pages


The changing demographics of America are reflected in the changing demographics of college students. Financial institutions trying to reach college students will have to adapt to the different financial needs, knowledge and backgrounds of various segments if they expect to gain their fair share of the market.
Table of Content

Scope and Themes

What you need to know
Data sources
Consumer survey data
Direct marketing creative
Abbreviations

Executive Summary

Good news and bad news for colleges
A more diverse market
Increasing oversight of financial products offered on campus
Marketing strategies
Most students have at least one financial account
For most students, money equals security
They know they need to save for retirement, they just don’t know how
Men are easier to reach than women
Mobile apps are popular, but primarily to check account balances
Convenient bank branches are important
They are confident in their abilities to manage money
What we think

Issues and Insights

What do the changing demographics of college students mean to financial institutions?
The issues:
The implications:
How can financial institutions help students learn to manage credit?
The Issues:
The implications:

Trend Application

Inspire Trend: Locavore
Inspire Trend: Immaterial World
Inspire Trend: Life Hacking

Market Size and Forecast

Key points
The number of Americans aged 18-24 is shrinking
Figure 1: Population change, by age group, 2009-19
Undergraduate enrollment is projected to increase
Figure 2: Projected undergraduate enrollment at all postsecondary degree-granting institutions, 2014-22

Market Drivers

Key points
Student debt impacts the way students spend money
Figure 3: Student debt as a percentage of total US consumer debt, Q3 2011- Q3 2014
Increasing oversight of financial products offered on campus

Demographic Profile of College Students

Key points
Changing demographics of college students
Percentage of female students continues to rise
Figure 4: Undergraduate enrollment, by gender, 2004-20
Growth of Hispanic and Asian students
Figure 5: Composition of students enrolled in college, by race/Hispanic origin, 2004-13
More international students
Figure 6: National composition of international students, undergraduate and graduate, 1999/00, 2013/14

Innovations and Innovators

Key points
CashCourse

Marketing Strategies

Key points
Marketing to students
Wells Fargo
Figure 7: Wells Fargo college student financial newsletter, 2015
PNC Bank
Figure 8: PNC Virtual wallet email ad, 2014
Citizen Bank
Figure 9: Citizens Bank online student loan ad, 2014
Marketing to parents
Citibank
Figure 10: Citibank financial information newsletter, 2014
UPromise
Figure 11: UPromise RewardU® email ad, 2014
College students and social media

Account Ownership

Key points
Most students have multiple accounts
Figure 12: Ownership of financial products, December 2014
One bank, or many?
Men are more likely to have financial accounts
Figure 13: Ownership of financial products – Any ownership, by gender, December 2014
Older female students are least likely to have savings accounts at traditional banks
Figure 14: Ownership of financial products – Any ownership, by gender and age, December 2014
Hispanics are less likely to use traditional banks
Figure 15: Ownership of financial products – Any ownership, by Hispanic origin, December 2014
Joint ownership with parents drops at age 21
Figure 16: Ownership of financial products – Joint account with my parent(s)/guardian, by age, December 2014
Do not have
Figure 17: Ownership of financial products – I do not have this, by gender, December 2014

Communication Preferences

Key points
Most want less communication, not more
Figure 18: Preference for communication from financial institution, December 2014
An overwhelming preference for email
Figure 19: Preferred method of communication, by gender, December 2014

Attitudes toward Money and Investing

Key points
College students have been affected by the recession
Figure 20: Attitude toward money and investing – Any agree, by gender, December 2014
Full-time work affects college students’ attitude toward money
Figure 21: Attitude toward money and investing – Any agree, by employment, December 2014

Source of Financial Information

Key points
Most get information from family members
Figure 22: Source of financial information, by gender, December 2014

Mobile App Usage

Key points
Device they use
Most use their phones to bank
Figure 23: Use of mobile banking app, by device, December 2015
What they use them for
Most use apps to check balances
Figure 24: Transactions conducted via mobile app, by gender, December 2014
Why they don’t use them
Many students don’t see the need
Figure 25: Reasons for not downloading or using a banking mobile app, December 2014

Use of Mobile Payment Services

Key points
Parents are a market, too
Figure 26: Use of mobile payment services, by age, December 2015
PayPal is the leader
Figure 27: Mobile payment service used to pay other people, December 2014*

Banking Behavior

Key points
Students open own accounts at age 20
Figure 28: Location of checking/savings account, by age, December 2015
Checking accounts are monitored more closely than savings accounts
Figure 29: Account monitoring activity, by age, December 2014
Devices most used to conduct banking transactions
Figure 30: Preferred device for banking transactions, by age, December 2015

Attitudes toward Financial Institutions

Key points
Convenient bank branches are important
Figure 31: Attitudes toward financial institutions, by gender, December 2015
Hispanics offer opportunity for less traditional alternatives
Figure 32: Attitudes toward financial institutions – Any agree, by Hispanic origin, December 2014

Attitudes toward Personal Finance

Key points
Students are wary of credit
Figure 33: Attitudes toward personal finance – Any agree, by gender, December, 2015
Importance of budgeting

Involvement in Finances

Key points
Men are more involved in their finances
Figure 34: Involvement in finances, by gender, December 2015

Payment of Expenses

Key points
Most college students have some financial responsibility for their expenses
Figure 35: Payment of expenses, by gender, December 2015
Parental support wanes when students reach age 21
Figure 36: Payment of expenses, by gender, December 2015
Hispanic parents are less likely to contribute

Financial Concerns after Graduation

Key points
Most students are concerned about making enough to live on their own
Figure 37: Main financial concerns after graduation, December 2014

Plans to Switch Banks

Key points
Most don’t plan to switch
Figure 38: Plans to switch banks upon graduation, by gender, by age, December 2014

Cluster Analysis

Cluster methodology
Financially Disconnecteds
Demographics
Characteristics
Opportunity
Financially Comfortables
Demographics
Characteristics
Opportunity
Financially Independents
Demographics
Characteristics
Opportunity
Cluster demographic tables
Figure 39: Target cluster, by demographics, December 2014
Figure 40: Target cluster, by demographics, December 2014 (continued)
Cluster characteristic tables
Figure 41: Target clusters, December 2014
Figure 42: Ownership of financial products – Any ownership, by target clusters, December 2014
Figure 43: Ownership of financial products – In my own name, by target clusters, December 2014
Figure 44: Ownership of financial products – Joint account with my parent(s)/guardian, by target clusters, December 2014
Figure 45: Ownership of Financial Products – Joint account with my spouse/partner, by target clusters, December 2014
Figure 46: Ownership of financial products – I do not have this, by target clusters, December 2014
Figure 47: Preference for communication from financial institution, by target clusters, December 2014
Figure 48: Preferred method of communication from financial institution, by target clusters, December 2014
Figure 49: Attitude toward money and investing – Any agree, by target clusters, December 2014
Figure 50: Source of financial information, by target clusters, December 2014
Figure 51: Use of banking mobile app, by target clusters, December 2014
Figure 52: Transactions conducted on mobile app, by target clusters, December 2014
Figure 53: Banking behavior, by target clusters (frequencies/counts), December 2014
Figure 54: Attitudes toward financial institutions – Any agree, by target clusters, December 2014
Figure 55: Use of mobile payment service, by target clusters, December 2014
Figure 56: Payment of expenses and future banking plans, by target clusters, December 2014
Figure 57: Financial concerns after graduation, by target clusters, December 2014

Appendix – Other Useful Consumer Tables

Account ownership
Figure 58: Ownership of financial products – Any ownership, by employment, December 2014
In own name
Figure 59: Ownership of financial products – In my own name, by gender, December 2014
Figure 60: Ownership of financial products – In my own name, by gender and age, December 2014
Figure 61: Ownership of financial products – In my own name, by Hispanic origin, December 2014
Figure 62: Ownership of financial products – In my own name, by employment, December 2014
Joint ownership with parents/guardians
Figure 63: Ownership of financial products – Joint account with my parent(s)/guardian, by gender, December 2014
Figure 64: Ownership of financial products – Joint account with my parent(s)/guardian, by employment, December 2014
Do not have financial account(s) or product(s)
Figure 65: Ownership of financial products – I do not have this, by gender and age, December 2014
Figure 66: Ownership of financial products – I do not have this, by Hispanic origin, December 2014
Figure 67: Ownership of financial products – I do not have this, by employment, December 2014
Communication preferences
Figure 68: Preference for communication from financial institution, December 2014
Figure 69: Preferred method of communication from financial institution, by employment, December 2014
Attitude toward money and investing
Figure 70: Attitude toward money and investing – Any agree, by gender and age, December 2014
Figure 71: Attitude toward money and investing – Any agree, by employment, December 2014
Source of financial information
Figure 72: Source of financial information, by gender, December 2014
Figure 73: Source of financial information, by gender and age, December 2014
Use of mobile apps
Figure 74: Transactions conducted on mobile app, by gender, December 2014
Figure 75: Reasons for not downloading or using a banking mobile app, December 2014
Banking behavior
Figure 76: Banking behavior, by age, December 2014
Attitudes toward financial institutions
Figure 77: Attitudes toward financial institutions – Any agree, by gender, December 2014
Figure 78: Attitudes toward financial institutions – Any agree, by age, December 2014
Figure 79: Attitudes toward financial institutions – Any agree, by gender and age, December 2014
Figure 80: Attitudes toward financial institutions – Any agree, by Hispanic origin, December 2014
Figure 81: Attitudes toward financial institutions – Any agree, by employment, December 2014
Attitudes toward personal finances
Figure 82: Attitudes toward personal finances – Any agree, by age, December 2014
Figure 83: Attitudes toward personal finances – Any agree, by gender and age, December 2014
Figure 84: Attitudes toward personal finances – Any agree, by Hispanic origin, December 2014
Figure 85: Attitudes toward personal finances – Any agree, by employment, December 2014
Involvement with Finances
Figure 86: Involvement with finances, by age, December 2014
Figure 87: Involvement with finances, by gender and age, December 2014
Figure 88: Involvement with finances, by Hispanic origin, December 2014
Figure 89: Involvement with finances, by race, December 2014
Payment of expenses
Figure 90: Payment of expenses, by gender and age, December 2014
Figure 91: Payment of expenses, by Hispanic origin, December 2014
Figure 92: Payment of expenses, by race, December 2014
Financial concerns after graduation
Figure 93: Main financial concerns after graduation, by gender and age, December 2014
Figure 94: Financial concerns after graduation, by employment, December 2014

Appendix – Trade Associations

American Bankers Association
Consumer Finance Protection Board (CFPB)

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