Does financial stress affect university students academic achievement?

Does financial stress affect university students academic achievement?

Raghad Al-Shehri

Prince Sultan University

Does financial stress affect university students academic achievement?

This study is examining the financial stress topic among university students. There are

many students who have to work while they are attending college. Some students have to work

in order to pay their way through college. There are many times when students have to work late

at night and then do not have the time to study. Worrying about their financial issues and their

grades can be an immense stressor in their academic life. Trockel, Barnes, and Egget, (2000)

found that more time spent at work can encroach on time otherwise available for studying. In a

national survey of college students and recent college graduates in the USA, Inceptia explored

the impact of financial stress on students. The survey revealed that one third of respondents said

financial stressors have had a negative impact on their academic performance or progress and

students who work more than 20 hours per week during the academic year are significantly more

likely to report that financial stress has had a negative impact on their academic progress or

performance and that they reduced their academic course load due to this stress. Todays

incoming college students are reporting higher levels of poor mental health than ever before

(Cooperative Institutional Research, 2010) and financial stress is an emerging issue within this

trend.

Keywords: financial stress, bad effects, academic achievements, free education.

Does financial stress affect university students academic achievement?

Because of the continuous changing nature of the university environment, students can go

through high levels of financial stress that can affect their academic performance (Hamaideh,

2011). Over the last few years, higher education financing has changed greatly. This shift arguably

began with the Higher Education Act of 1992 which prioritized loans over need-based grants

(Hannah, 1996). Additionally, state government spending on other priorities, particularly

Medicaid, has resulted in reduced higher education appropriations to public institutions (Kane,

Orszag, & Gunter, 2003). Consequently, it is not surprising that financial stress is a leading

stressor among undergraduates and is harmful for the academic life of undergraduate students.

In 2003, about 45 % of dependent students had unfulfilled demands, the difference between

the university expenses and the family subsidization (Long & Riley, 2007). This difference was a

little big, as the unfulfilled demand was about $6,000. This unachieved demand is especially a

big problem for students as they face credit constraints (Becker, 1993; Belley & Lochner, 2007)

and have little financial knowledge (Avard et al., 2005; Chen & Volpe, 1998; Murphy, 2005).

Even if a student does not have any unachieved demand, most undergraduates depend on large

loans to meet the financial demands of their college educations. Despite the fact that students do

not have to repay their loans while registered in college, the bachelors graduate with a loan

assemble nearly $24,000 in student loan debt (Baum & Payea, 2012).M o s t students worry

about their ability to make enough money to pay their loans, especially when they see high

unemployment for young adults. This worry may largely affect the students academic

achievements while enrolled at university. In the last few decades, more traditional age students

have to work and work considerably more hours (Scott-Clayton, 2012). Therefore, an increasing

number of students must balance the need to work to pay for the college or living expenses and

the need to study. In this sense university students may spend much more time trying to get
Does financial stress affect university students academic achievement?

enough money to finance their lives, study and social. The thing that will make it difficult for

these students to focus on their study life as their most concern will be towards having a good job

and maintaining it. In this sense, students who work to support themselves will not have enough

time to maintain their studies as those who do not work. In other words, those students will be

ahead in their academic lie because they dont have many things out of their study life to think

about. Similarly, Inceptia in a survey discovered that college students who work for more than 20

hours every week through the university year are greatly more likely to report that financial

stress has had a negative impact on their academic progress or performance (46 percent) and that

they decreased their academic course load because of that stress (49 percent) when compared to

those who worked less than 20 hours per week (24 and 27 percent, respectively).

Wharton (2007) looked at college students financial status affecting their academic

achievements, measured by GPA and credit hours earned. Financial stress among university

students was measured by students themselves reporting whether the amount of debt was the

reason to reduce class loads, think about leaving college before even finishing, or pay too little

attention to academic work or not. The students who said they suffer from financial stress were

discovered to get low grades and register for fewer credit hours in each quarter. Joo, Durband,

and Grable (2008) also examined university students financial stress from the viewpoint of

academic effects. The students who had to have academic reduction and disturbance , such as

lessening course loads or leaving university for a semester or a year due to financial matters,

reported higher stress from their personal finances. In the United Kingdom, Ross, Cleland, and

Macleod (2006) explored loan, stress, and academic performance of medicine college students.

The respondents reported that money is the second most noteworthy reason of stress following

coursework. Students who related worrying about money to their low academic performance
Does financial stress affect university students academic achievement?

were discovered to have weaker academic performance, while the level of debt itself showed no

direct relationship with academic performance. Other newer surveys have discovered that

financial worries meddle with academic performance (NSSE, 2012; Trombitas, 2012). A study

by Trombitas (2012) resulted in a discovery that one third of respondents said that financial

stressors have had a negative impact on their academic performance or progress. One survey

concentrating particularly on financial stress revealed that four of the five most common

stressors among students related to their personal finances (Trombitas, 2012). A third of students

also said that finances negatively affected their performance and progress in academic and

university life. Additionally, one out of five students reduced the number of courses they enrolled

in due to their finances. From what has been mentioned in this section, we can find a huge effect

on the academic achievements and study life of university students. Academic low performance

may include lessening load, dropping off a term or even a year form university and low GPAs.

In a recent book, Going to College: How Social, Financial, Educational Experiences

Influence the Decisions Students Make (Hossler, Schmit, and Vesper, 1998), they research

carefully the effects of university and college costs, financial aid and many other factors. They

discuss the influence of the above factors on the decisions of high school students as they move

forward from the ninth grade through high school graduation. The writers found that one of the

main factors that parents, and students, consider when deleting and adding colleges to the list of

schools they are looking into is the perceived costs and the possibilities of receiving financial

aid. This process of deleting and adding schools starts as early as the tenth grade. Moreover,

parents play a very important role in this process. Simple statements such as We cant afford to

send you to that school or You can attend that school if you get a scholarship can have a large

impact on which colleges students really take into account. Such discoveries are consistent with
Does financial stress affect university students academic achievement?

Jacksons meta-analysis of the effects of financial aid on student enrollment decisions. Jackson

(1978) found out that many students fail to consider or needlessly eliminate colleges and

universities that might have been good choices for them because they believe they cannot afford

to attend these schools. Such discoveries lead to two additional conclusions. Total cost of

attendance influences the decisions of students long before they get to the point of selecting

which college to attend. The timing of when students (and their parents) learn about actual or

possible financial aid packages can influence the planning for going to college, even at very early

stages of the process. In sum, these findings imply that even secondary school students and their

parents try to avoid financial stress even before they start their study life at university. Nowing

they will suffer from that stress and that it will affect their study life and achievement, they try to

be way from it even before it starts.

In a survey done by Inceptia on the impact of financial stress on students they found out that:

overall, 34 percent of students said that financial stressors have had a negative influence on their

academic performance and progress, and another 20 percent said that they have had to lessen

their course load because of the same stressors. Moreover, they investigated the borrowing

practices of students who said that financial stress has had a bad impact on their academic

progress. Average scores were higher for those students who said that financial stressors had

negatively influence their academic progress in comparison to those who did not say it existed.

The results were as follows:

Financial Stress Negatively Reduced Course Load Due

Impacted Academic Progress to Financial Stress

 Does financial stress affect university students academic achievement?

or Performance

Mean Stress Score, Yes No Yes No

Borrowing Money for

4.10 3.42 4.19 3.53
College

On the other hand, we can find that some argue that it is not always true that free or partially

free university education a good idea. Inan argument on one of the websites, I found out that a

friend of mine argues that if we made higher education free, I think that the value of university

and college studies would go down in a downward spiral, along with the value for education. We

have to admit that we value our university studies and higher education very much because we

know we have to spend a lot through the line of our studies. The loans we have taken out for this

education is what reminds us why we're pursing out this dream. If it was free we wouldn't have

as much drive and not to mention many would abuse this education policy. If we made education

free, how would the professors who teach us get paid? Or the faculty who serves the school?

There are many issues with making education free. But if they could lower tuition and give

colleges more funding to help support students with their educational needs that would be the

proper solution to this issue. To dispute this point of view, I have to mention that many

countries all over the world offer free education to its students. Take Saudi Arabia, we have the

whole education system for free and the government is able to pay off all the fees, salaries and

the costs of teaching. Moreover, students highly appreciate it and always care for their studies

and do their best. To add more, the quantity of graduate students is much more higher than it is in

other countries that charge students fortunes to be able to study; another thing is that the quality

of graduate students here is almost the same in countries which do not have free education.
Does financial stress affect university students academic achievement?

In conclusion, we find that understanding how financial stress impacts their college

experiences is imperative because, in many ways, it affects negatively the students academic

performance. On one hand it will cause worry and distress among students and most of their focus

will be on paying off their loans through many ways including working for long hours which will

decrease their academic achievements as well as the duration students spend at the university

because, sometimes, they will have to lessen study load and even drop a whole semester.

Therefore, we need to help our students as much as we can either b government subsidization or

by offering free education the university because financial stress is a dangerous thing and helping

them will make students have great outcomes and achieve better in their studies.

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