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EDELMAN INTELLIGENCE

Experian College GraduateSurvey Report

April 2016

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WHO HOW MANY ACCURACY WHEN HOW

Soon-to-Be College

Graduates(College

students ages 18-25

graduating in the next 6 months)

n=1,000 Margin of Error = +/- 3.1%

Data Collection Occurred

April 11-19, 2016

Online Survey

RESEARCH OBJECTIVE: Better understand soon-to-be college graduates’ experiences, knowledge and

perceptions related to personal finance and credit and debt management

Research Methodology

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Key Findings

Soon-to-be college graduates feel “stressed” and “worried” about their current financial status

They expect their financial stability to improve after graduation but still feel the odds are stacked against them

Majorities wish they had taken on less student loan debt and already expect to defer payments on student loans

Students say that their colleges did not prepare them to manage credit, and most have questions about credit scores

CURRENT FINANCE PERCEPTIONS

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Many college students do not feel financially secure, driven by low earnings and reliance on student loans

Excellent Very good Good Fair

Current Financial Security

40%Rate their CURRENT

financial security as POOR/FAIR

Work study doesn't pay enough

Not earning any money

Not putting money into savings

Relying on my parents

Relying on student loans

14%16%

20%23%

36%40%42%42%43%

49%

Reasons for Current Financial Insecurity

Q3. Thinking about your life while enrolled in college, how would you rate your financial security?Q4: Why did you rate your financial security while enrolled in college as [poor/fair]? (Asked if rated current financial security as poor/fair; n=403)

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Those with student loan debt are especially concerned about their current financial security

Subgroups More Likely to Rate their Current

Financial Security as “POOR/FAIR”

Subgroups More Likely to Rate their Current

Financial Security as “EXCELLENT/VERY GOOD”

TOTAL 40%

TOTAL 29%

Those with $20K+ in student loans

54% Those with no student loans 45

%

Those with any student loans 46% Those without any type of debt 44

%

Women 45% Men 34

%Those who do not know their credit score

45%

Those who do know their credit score

32%

Q3. Thinking about your life while enrolled in college, how would you rate your financial security?

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Q14. In general, how do you feel about your current financial status? Q15. Which, if any, of the following issues are you worried about? (Asked if worried about current financial status; n=330)

Students feel stressed and worried about not having enough money and being reliant on others or loansEmotions about Current Financial Status

EmpoweredInformedConfident

SecureSatisfiedHopeful

8%16%17%18%

20%31%

ConfusedHelpless

FrustratedOverwhelmed

WorriedStressed

13%16%

26%30%

33%37%

Current Financial Status Concerns

Having bad creditNot establishing a credit history

Spending beyond my meansNot being able to stick to budget

Carrying too much debtFinancial dependence on parents

Not having enough to spendNot earning enough money

Not having enough in savings

30%30%

35%38%

50%52%

63%63%

70%

FUTURE FINANCE PERCEPTIONS

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* Nets may not add up due to roundingQ1. In general, how do you feel when thinking about your life after graduation? Q3. Thinking about your life while enrolled in college, how you would rate your financial security?Q5. Thinking about your life after graduation, how do you anticipate rating your financial security?

Students are excited about life after graduation and expect their financial security to improve

Financial Security Pre- and Post-Graduation

Pre-Graduation

Post-Graduation

11%

5%

30%

22%

30%

34%

17%

23%

11%

14%

Poor Fair Good Very good Excellent

Emotions about Life Post-Graduation

40% POOR/FAIR*

27% POOR/FAIR

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College major and amount of student loan debt are factors in graduates’ feelings of future financial security

Q5. Thinking about your life after graduation, how do you anticipate rating your financial security?

Subgroups More Likely to Rate their Future Financial Security

as “POOR/FAIR”

Subgroups More Likely to Rate their Future Financial Security as “EXCELLENT/VERY GOOD”

TOTAL 27% TOTAL 37%Those majoring in social sciences / services 34% Those majoring in business 44%

Those with $20K+ in student loans 34% Those majoring in S.T.E.M. 44%Those who do not know their credit score 33% Those who do know their credit

score 43%

Private university graduates 32% Those with no student loans 42%

Women 30% Those majoring in health and medicine 42%

Those majoring in arts & humanities 29% Men 40%Those with student loans 29% Those with < $20K in student loans 39%

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Q6. Why do you anticipate rating your financial security after graduation as poor/fair? (Asked rated current financial security as poor/fair; n=267)Q7. Which of the following best describes where you are in your employment search? (Asked if planning to get a job after graduation; n=844; Shown off total base)

Student loan debt is a major concern among those who feel insecure about their post-graduate financial status

Reasons for Post-Graduation Financial Insecurity(Shown: Top 10 Reasons for Rating Post-Graduation Financial Security as Poor/Fair)

Will have to pay off other debt May need to take out additional loans

No high-paying jobs for my degreePlan to continue my education post-grad

May have to move back homeMay not earn enough to support myself

May not earn enough to spend beyond basicsMay not earn enough to add to savings

May not have a full-time job lined upWill have to start paying off my student loans

25%25%25%27%

31%47%47%

52%54%55%

Just 16% of soon-to-

be graduates

already have a job lined up

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53%47%

Financial Perceptions(Shown: % Agree)

Despite general optimism, many feel that achieving financial security will be an uphill battle

Q18. To what extent do you agree or disagree with each of the following statements? Q19. What life goals do you think your finances will hold you back from pursuing after graduation? (Asked if agree that finances will hold back from pursuing life goals after graduation; n=468)

Changing careers

Starting a businessGoing back to school

Getting marriedHaving children

Buying a car

Traveling the worldBuying a home

25%

32%38%

39%41%

50%

59%63%

Life Goals Hindered by Finances

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Ultimately, many are hopeful about their financial future, but worried about salaries and loan payments

Concerns about Financial FutureEmotions about Financial Future

Q16. Generally, how do you feel when thinking about your financial future?Q17. Which, if any, of the following issues are you worried about? (Asked if worried about financial future; n=270)

Protecting my identity

Being able to establish good credit

Saving enough money to retire

Being able to own a home

Becoming financially independent

27%43%45%

53%55%

61%66%66%68%

73%

FINANCIAL SNAPSHOT

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Q21. Below is a list of different types of loans and debts. Please indicate whether you currently have any of the following.Q22. To the best of your knowledge, approximately how much debt do you currently have…? (Asked for each type of debt held)

Student loans are the most pervasive type of debt for soon-to-be graduates

Student Loan Debt

Credit Card Debt

Auto Loan Debt

Home Loan Debt

Other Type of Debt

Currently Have 69% 30% 23% 12% 6%

Average Amount

$22,813 $2,573 $10,37

9$36,39

8 $6,771

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Familiar Heard the term Unfamiliar

Q28. Prior to this survey, were you familiar with the concept of co-signing? Q29. To the best of your knowledge, have you ever needed a co-signer for any of the following types of contracts? Please select all that apply.

Many college students have personal experience with cosigning, specifically for student loans

77%Familiar with co-signing

Cosigning Familiarity

Home loan

Legal agreement for credit card

Car lease

Car loan

Home/apartment lease

Loan for tuiton

9%

12%

16%

22%

26%

30%

Personal Cosigning Experiences

68%Have

needed a co-signer

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Q23. Which of the following statements comes closest to your opinion?Q25. In general, how concerned are you about paying back your debt? (Asked if have debt; n=838)

College grads are split on whether being “debt free” is attainable; most are concerned about loan payments

Debt Perceptions Concern about Repaying Debt

72%Concerned

about paying

back debt

53%Being “debt free” is an attainable goal

47%Debt is a

necessary evil

In today’s economy…

VS.

Those with < $20Kin student loans:

69%Those with $20K+in student loans:

81%

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Q27. Which, if any, of the following concerns about debt are a source of anxiety for you personally? (Asked if have debt; n=838)

They worry about about how long they will be paying back their debt and potential impacts on their future

My debt will hold me back from getting another loan

My debt will hold me back from continuing my education

My debt will hold me back from starting a family

I don’t fully understand all of my payment options

My debt will negatively affect my credit score

My debt will hold me back from making a big purchase

I will be paying back my debt for a long time

31%

31%

32%

33%

42%

47%

59%

Concerns about Debt

Those with $20K+ in student loans:

60%

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Most wish they had taken out less in student loans, and more than half are likely to defer payment

Student LoanPerceptions

Likelihood to Defer Student Loans

54%Likely to

defer student loans

43%I am

comfortable with the

amount of my student loan

debt

57%I wish I had taken on less student loan debt

Q33. Which of the following statements comes closest to your opinion? (Asked if have student loans; n=690)Q32. How likely are you to need to defer payment on your student loans? (Asked if have student loans; n=690)

VS.

74% among those with $20K+ in student loans

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Q33. Which of the following statements comes closest to your opinion? (Asked if have student loans; n=690)Q32. How likely are you to need to defer payment on your student loans? (Asked if have student loans; n=690)

Those getting a degree in business or S.T.E.M. feel most comfortable with their student loan debt

Placeholde

r

Arts & Humaniti

es

Social Sciences

& Services

Health & Medicine S.T.E.M. Business

n=124 n=165 n=136 n=157 n=184Likely to

Defer Student Loans

52% 71% 53% 50% 52%Comfortable with Student

Loan Debt34% 39% 38% 53% 49%

Wish I Had Taken on Less in Student Loans

66% 61% 62% 47% 51%

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Personal Experiences with Credit

Cards

Q20. Please indicate how many credit cards you currently have. (Shown: % Have at least one credit card; Mean number of credit cards)Q31. On average, how much do you charge to credit cards (not debit cards) each month? (Asked of credit card users; n=578)Q32. Which, if any, of the following have you ever experienced regarding a credit card in your name? (Asked of credit card users; n=578) Q30. When you sign up for a credit card, which of the following best describes how you interact with the Terms & Conditions? (Asked of credit card users; n=578)

Credit card spending is another main source of debt for soon-to-be college graduates

Missed a payment

Had card declined

Maxed out a card

Made a late payment

15%

23%

31%

33%

Approach to Credit Card Terms and Conditions

15%

46%

39%

Read entirelySkim terms then accept

% Have a credit card

58%Average number of credit cards

1.35Average monthly charges

$531

CREDIT & DEBT EDUCATION

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Q9. While you were enrolled in college, how would you rate your…?

Students feel that colleges provide them with subpar opportunities to learn about credit and personal finance

Excellent Very good Good Fair Poor

48%Rate their access to

information on credit & finance as POOR/FAIR

Access to Information about Credit & Personal

FinanceExcellent Very good Good Fair Poor

50%Rate their

opportunities to learn about credit

& finance as POOR/FAIR

Opportunities to Learn More about Credit &

Personal Finance

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Q12-13. Which of the following sources have you used in the past for information about personal finance/credit & debt management? Q18: To what extent do you agree or disagree with each of the following statements? “When it comes to my finances I feel like I’m going it alone.”

Instead, they look to their parents or search engines for this information; many feel they are “going it alone”

My parentsAn internet search

FAFSA My friends

A bank representativeA mobile application

My spouse / significant otherA financial advisorMy social network

My coworkers

70%45%

39%38%

27%21%21%

17%16%16%

55%27%

17%23%

20%13%15%

11%12%

11%

Credit & Debt Info

Information Sources(Shown: Top 10 Information Sources)

Agree Disagree

55%When it comes to my finances I feel like I’m going it

alone

Finance Perceptions

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Q8. Next, we would like for you to grade your college or university on a few attributes. For each of the following, please give your college a grade, from A-F, on how well you think your college prepared you for…?

Knowing how credit scores work

Managing credit & debt

Managing a personal budget

Life after graduation

21%

20%

20%

32%

22%

26%

32%

35%

21%

25%

26%

23%

15%

15%

12%

6%

19%

12%

9%

2%

College Report CardA B C D F Median

Grade

B

B

C

C

One in five college grads gives their college an “F” on preparing them to understand how credit scores work

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40% 38% 38%31% 29%

26% 24%21%

31%25%

34%29%

36%41%

37%

27%

Learned about in college… Wish I had been able to take a college course in…

Q10. Which, if any, of the following topics did you learn about in college?Q11. Which, if any, of the following topics do you wish that you had been able to take a college course in? (Asked for each subject not learned about in college)

Students have an appetite for college courses on credit scores, reports and overall management

Teaching Financial Literacy in College(Shown: % Learned in College, % Wish I had Learned in

College)

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I understand which financial factors are currently helping or hurting my credit

My credit history could affect my ability to get a good interest rate

I have questions about the different types of credit scores

My credit history could affect my ability to get a loan

I have questions about what my credit score means

69%

67%

67%

65%

59%

Credit Understanding Statement Agreement(Shown: % Agree)

Q38. Below is a series of statements about credit. To what extent do you agree or disagree with each of the following statements?

While they may overstate their credit savvy, most acknowledge they have questions about credit scores

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Q35. To the best of your knowledge, have you ever seen your…?Q36. Do you know your credit score? Q37. And, do you think your credit status is…?

Most soon-to-be grads have never seen their credit report and do not know their credit score

Credit score Credit report

37%46%

58%43%

11%

Yes No Unsure

Ever Seen CreditScore or Report

PerceivedCredit Status

8%

24%

29%

21%

10%7%

Excep-tionalVery goodGoodAverage

Yes No Unsure

47%Know their credit score

Know TheirCredit Score

DEMOGRAPHICS

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Category Subcategory %

GenderMale 40%

Female 60%

Age

18-19 8%20-21 26%22-23 37%24-25 29%

Region

Northeast 20%South 36%West 22%

Midwest 21%

Race/Ethnicity

White 63%African American 14%Hispanic/Latino 11%Asian American 7%

Other/Multi-racial 5%

Category Subcategory %

Know Credit ScoreYes 47%No 43%

Unsure 10%

Perceived Credit Score

Exceptional 8%Very good 24%

Good 29%Average 21%

Poor 10%Unsure 7%

2-Year vs. 4-Year College

2-Year 29%4-Year 71%

Public vs. Private College

Public 72%Private 26%Unsure 2%

Anticipated Graduation Date

In the next 3 months 62%In the next 4-6

months 38%

Student Loan Debt

Yes 69%No 31%

DemographicsRespondent Demographics

Totals may not add up to 100 due to rounding

THANK YOU