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Can Student Saving Accounts Affect Both School and Social Happiness

Evan M Dedischew

Department of Business Information Systems Central Michigan University

BIS101WI: Essential Business Communication.

Dr. Michele A. Bartosek

March 27th, 2024

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Table Of Contents

Abstract……………………………………………………………………………………...…....3

Introduction……………………………………………………………………………………….4

Literature Of Review……………………………………………………………………………..5

Methods………………………………………………………………………………………......1

Limitations…………………………………………………………………………………....….1

Results From Research………………………………….......…………………………………..11

Results From Discussion……………….……...………………………………………………..13

How can financial insecurity affect your mental state while attending CMU……………….....13

How can the amount in your saving effect how students act regarding to there confidence in

various social settings as well as provide throughout college………………...........…………...13

In what ways has Central Michigan University done a good job or not in educating and preparing

students for financial success?......................................................................................................13

Conclusion………………………………………………………………………………...…….15

Recommendation………………………………………………………………………………..16

References…………..…………………………………………….……………………………17
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Abstract

Central Michigan University faces the problem of many students facing financial stress

from not only the cost of college but from additional supplies and the cost of social events.

Students who enter college have either got support from other resources or have had to work to

remain enrolled in college. This is a factor that causes stress and anxiety for students. For this

report, I focused on why this is happening to students and what impact it has on a student’s

health as well as academic performance. To achieve this, I developed three research questions.

How can financial insecurity affect your mental state while attending CMU? How can the

amount in your saving effect how students act regarding to their confidence in various social

settings as well as provide throughout college? In what ways has Central Michigan University

done a good job or not in educating and preparing students for financial success? I conducted

primary and secondary research to ensure accurate answers. Through secondary research I

discovered that college is expensive and in order for a good portion of students to attend school

they must find a way to source income to provide for their needs. Also, that students want to fit

into social norms and when not financially able to, students develop stress and anxiety. This

leads to less time for students to study and will be at a disadvantage for school performance.

Through primary research I discovered that students are not aware of any programs to help them

get a better education in the importance of savings. To conclude CMU needs to develop better

services for students and consider the fact not all students can afford college. If Central Michigan

University applied these changes, then students would perform better in schools as well as be

more confident when going out In a social setting.

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Introduction

Central Michigan University (CMU) is a fantastic college to be enrolled in and the

programs offered at CMU are widely accepted around the world. Although CMU excels at

education, the institution lacks in the support offered to students for the importance of having

money in savings accounts while at college. This is a more common problem among college

students and depends on different levels of income. If this problem is not dealt with then students

can be at chance of financial debt after college leading to a harder adult financial life. Through

looking at research we can see the challenges that arise among students. These challenges consist

of stress and emotional damage a student can experience with having no savings account. limited

support from CMU offers no program or designated web page on how to save money and control

your own finances. We also explore how students are spending money in college and what most

people are spending money on. The estimated cost of college for four years and students

currently enrolled at CMU. The research shows how the performance of students struggling

financially is also struggling in school. We explore how stress leads to bad and impulsive

purchases. While these factors are a crucial part of the study, we also research and observe why it

is important to save in college, as well as how much an average student needs financially to get

through the academic year. All of these factors are important because many current students

struggle with keeping money in their savings accounts, and this causes anxiety and stress which

leads to bad school performances. Students are currently struggling with managing their own

savings accounts and with the cost of attending CMU and attaining all school resources

necessary, stress and other factors such as social aspects cause students to not only have anxiety

but also perform worse in school. Both students and Central Michigan University are affected.
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Review of the Literature

Cost & Estimated Amount For College

According to (CMU), the “Cost of attendance (COA) is an average estimate of costs a

student would have if enrolled at CMU for the fall and spring semesters.” (n.d.). The COA is

important to understand because it may vary from other Colleges and Universities. Also stated by

CMU the total estimated cost of attendance for students living on campus is $31,830 (CMU,

n.p.). Depending on the location and the size of schools, the COA can vary in price. The reason

that prices can change and become more expensive than in previous years is that “According to

the College Board, the average cost for tuition and fees at four-year public institutions has

increased 225% over the last 30 years (after adjusting for inflation), and these costs will almost

certainly continue to rise” (College Savings Plans Network). This shows that over time colleges

must raise prices to keep up with external forces like inflation. Other costs that contribute to

college expenses consist of supplies and college student organizations. “In 2021-2022, the

average cost of books and supplies for a first-year college student was $1,215…survey data

shows students spent roughly $285 a year on course materials including books.” (Welding,

2023). Students need materials to attend a class and succeed in the class. Without paying for

books or other supplies a student can fall behind in the course material. This person also may feel

anxiety from falling behind other classmates. College Education is crucial to learning about

different careers and getting a proper education in all around areas. According to CMU, money

donated and collected from enrolled students gets distributed to other areas around the school.

CMU could route resources to help students who struggle with their own finances and educate

them to have a proper understanding.

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Earning and Retaining

Students who come into college may have had an opportunity to collect funds for college.

According to Lyss Welding who published an article called “How Do Most People Pay For

College?” in 2023, she found that there are a couple of different ways in which students have

gathered funds for college. Welding states “At an average of $11,150, parental contributions

covered the lion's share of a year of college expenses. Scholarships and grants took up the next

largest share at $8,150, followed by loans ($5,510), student income and savings ($2,760), and

gifts from relatives and friends ($450)” (Welding, 2023). This shows that people not in college

also understand how much college can cost, and efforts are made to help students afford the

opportunity of going to college. CMU is a college that offers a wide variety of scholarships

depending on different types of majors or years (CMU, n.d). However, these opportunities don’t

apply to everyone and a majority of students also rely on loans (Welding, 2023). Loans do not

offer the same advantages as scholarships, since loans need to be paid back and with an interest

rate, and if not paid back, then a student can go into debt (Welding, 2023). As the Foundation For

Economic Education mentions in the article there is an estimated “$1.56 trillion in student loans”

(FEEGA, 2019). Students who are currently enrolled and attending CMU could also make

money another way, rather than through scholarships and loans. This can be achieved by having

a job or internship while also being a student. Welding states, “40% of full-time students were

employed… Two-thirds (66%) of part-time students worked at least 20 hours a week” (Welding,

2023). This statement shows that the cost of living can be expensive, and students must be able

to pay basic expenses for survival. This leads to the next topic of retaining earnings that have

been made. With the information we have discovered, we have learned that there are other

expenses besides college that must be paid for like supplies and organizations. This is makes
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retaining earned money difficult. If a student has loans or expenses they must pay for those

factors. “the average student paid $2,763 against their college costs from their income and

savings.” (Welding, 2023). Income that is earned is constantly being used while in college. It’s

also worth mentioning that there is little to no information on CMU’s website for resources.

Spending & Behavior

Students who have funds and are in college have something called “Spending Power”

which can be described as “college students have a significant amount of spending power and

use their discretionary income for purchases outside of tuition and related expenses” (Raja,

2023). Students can use their money for outside purchases irrelevant to college. According to

Raja one factor of spending money can be seen in the food industry with regards to getting a

meal to consume but also trying to meet expectations of social media. “College students spend an

average of $547 each month on food, including groceries, restaurants and meal delivery services.

The rise of social media and the need to purchase things for status are a couple factors that

encourage students to splurge on Instagram-worthy food.” (Raja, 2023). Students try and meet

the expectations they see from social media. This can cause behavioral issues such as peer

pressure (Hicklin, 2023). As Hicklin states in her article to relate why students go out and spend

money “peer pressure in social groups to adhere to social norms (Hicklin, 2023). This states that

students don’t want to miss out on events and activities that their peers are doing. In a college

setting, there are constant advertisements and propaganda that attract students. Students have

been reported to regret certain decisions as stated in Hickling’s article, “Another student also

stated that she spends almost $100 monthly on coffee alone. “It makes me feel good when I’m

drinking it, but when I look at my bank statements and see I spent $100 on $5 coffees, I feel

guilty,” she said. However, she did not feel the same way concerning food, as she did not express
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the same guilt because the cafeteria is “less than ideal” (Hickling, 2023). This idea of regret that

students feel and the anxiety of fitting into a social norm (Hickling, 2023) does a toll to a

student’s behavior. A students first year in college is a crucial point of their financial lives (Raja,

2023). This is a time where students “where most take out student loans and apply for their first

credit cards” (Raja, 2023). If students are influenced by their peers, and want to fit into a social

norm, as well as gaining “spending power” then the loans they take out, and the college expenses

that must be paid, will only will only further students into a financial debt hole. Bad behaviors

can be seen as “those who were stressed out and then had their sense of control restored, we

found they were more willing to spend their money” (Devlin, 2016). This includes trying to meet

social norms (Hickling, 2023) and the cost it takes for basic expenses such as food, water, shelter

on top of college/ loan debt. With these factors colliding, students spend unnecessary amounts

without realizing how much they can actually spend. We know this because “Each year, 30 to 40

percent of undergraduate students take out loans” (Raja, 2023). This shows that students continue

to increase in the chances of going into debt.

Impact On Students

The impact among students who suffer from having a low fund savings account can be

seen impacting not just a student’s mental health (Gritters, 2023), but also a student’s

performance in school (Moore, 2021). To start off with mental health Gritters states, “The impact

of debt on mental health is not well researched, but a new study found that having debt and

feeling instability is associated with higher stress and anxiety levels” (Gritters, 2023). Although

there is little to no research in this topic, A professor named Lindgren in Gritters article, conducts

their own research on this study. As a result, Lindgren says “if you have more student debt and

you feel like things are unstable, you have higher levels of stress and anxiety,” (Gritters, 2023).
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Students who develop financial anxiety tend to try and find a coping mechanism. (Gritters,

2023). Unfortunately as stated by Lindgren in Gritters article, “If you have student loan debt,

you’re more likely to delay marriage, kids and buying a home. Life milestones get pushed back”.

This means students are at a disadvantage when they occur debt. In extreme cases many of the

individuals Lindgren studied in her research study reported to have perceived economic

instability (Gritters, 2023). This in return can be correlated to bad behaviors as described by

Lindgren. “Turned out to be linked to problematic drinking behaviors and increased mental

health symptoms. Higher student debt was correlated with higher stress.” This shows that there is

a connecting relationship between the amount of debt and financial stress a student has. This can

lead to anxiety and overwhelming stress (Gritters, 2023). Another aspect that occurs from

financial stress, is the performance rate in schools from low saving students. As mentioned in

Moore’s article “In these students’ perspectives, financial stress impedes their ability to succeed

academically” (Moore, 2021). This statement explains that students believe that finances are

more important then school education., but Moore explains that another huge factor is social

lives (Moore, 2021). A reason for this, as stated from Moore is “Students experiencing financial

stress find it challenging to navigate relationships with wealthier peers, often leading to feelings

of isolation and embarrassment” (Moore, 2021). This is related to performance in schools

because “Studies have shown that students who experience higher levels of financial stress are

more likely to discontinue their schooling than more financially secure peers. In addition, data

from the National College Health Assessment indicate that almost a quarter of students (24%)

reported that finances negatively impacted performance in a class. This may be due to having to

work more hours to pay bills or for living expenses, which subsequently reduces the number of
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hours that can be committed to studying” (Moore, 2021). This shows that there is a relationship

between financial stress and the negative impact on students (Moore, 2021).

Methods

How can student saving accounts affect both school and social happiness?

To gain a deeper and better understanding into how the amount of savings a student has,

relates to how they both perform in school and the mental state of a student while in a social

environment. In order to get a better understanding, I will be conducting primary research,

involving a survey with twenty people that will be filled out by current CMU students on Main

Campus. The survey will have questions regarding the student’s personal finances, and a rating

of how their mental state is with their current amount in savings.

To achieve this result, I will be trying to answer a series of three questions from participants:

 How can financial insecurity affect your mental state while attending CMU?

 How can the amount in your saving effect how students act regarding to there confidence

in various social settings as well as provide throughout college?

 In what ways has Central Michigan University done a good job or not in educating and

preparing students for financial success?

A qualitative study will be conducted so I can receive feedback as opposed to numerical data.

I choose to conduct a survey with short answer questions hosted on google forms regarding a

person’s happiness when it comes to their own amount in savings and how it reacts with

performance in schools, but also their state of mood in a social environment. The questions I

asked did not require a specific amount but rather feedback and opinion-based answers instead.

This in aims of receiving qualitative data. Once the data has been received and answered, I then

looked for trends and patterns within the data to match what I am trying to prove.
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Limitations

When it came to secondary research, articles were only used if they were fact checked or

peer reviewed and didn’t contain misinformation. Also, since the study is on students, only

articles containing college students were used. For primary research, limitations consisted of

only CMU currently enrolled students, and had to have any amount of funds in their savings

accounts. Lastly a student could not provide numbers for their reasoning, only feedback.

Results From My Research

In attempts to gain a deeper and better understanding into how the amount of savings a

student has, relates to how they both perform in school and the mental state of a student while in

a social environment. From this survey of twenty people, I was able to gather feedback in forms

of text responses and visual charts.

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The first conclusion that I have drawn is that 45% of students interviewed are

experiencing financial stress. Also 15% of students are soon to be experiencing financial debt.

On the other hand 45% of students are not experiencing financial stress. Another conclusion I

have drawn from this research study is that 70% of students have not heard of a CMU service

that educates students on why it’s crucial to have a managed savings account. This is a majority

of students from the survey population. The last conclusion that I have drawn is that there is

many students who have stress when it comes to money in a social environment and consist of

different factors.
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Discussion From Research

How can financial insecurity affect your mental state while attending CMU

Financial insecurity can affect your mental state while attending CMU, because as

mentioned earlier by Welding, students need enough money to be able to pay for college but also

be able to provide for supplies and social events. This causes students to get anxiety and develop

stress. As seen in primary research, 45% of students are currently facing financial insecurity.
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How can the amount in your saving effect how students act regarding to there confidence

in various social settings as well as provide throughout college

From my primary research we have learned that current students face stress from

social settings due to not having enough funds to participate in organizations or events.

Also that from not having enough money to provide for these extracurriculars, causes

stress for if the student can afford college. From secondary research, we learned that

students are easily peer pressured to enter social environments trying to fit into a social

norm created by others to fit in as mentioned by Hicklin. Also from research we learned

that students are increasingly taking out student loans to afford college.

In what ways has Central Michigan University done a good job or not in educating and

preparing students for financial success?

Central Michigan University as seen from secondary research provides little to no

information on how to save properly. We also discovered that students have bad spending habits

and can barely afford the cost of enrollment at CMU without attaining a loan. From primary

research we have discovered that 70% of students have not heard of a service to expand a

student’s education on the importance of savings.

Conclusion

In conclusion CMU)is a fantastic college to be enrolled in and the programs offered at

CMU are widely accepted around the world, but as we discovered throughout this study, CMU

lacks in properly educating college students on how to be smart with their own finances. We

have seen the affects and impacts it has on students, containing stress and anxiety for financial

insecurity. We have also discovered how much CMU cost and the precautions that students take

to afford college. Opposed to that we have seen how students enter college with money but some
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must work and provide to remain in school. We have discussed how students react to financial

stress and the outcome of social confidence as well as academic performance. This study also

conducted primary research to gather qualitative data to further explore how student saving

accounts affect both school and social happiness. We have learned that students have not heard

of support programs and are currently facing their own financial problems.

Recommendations

Through my study I have found that CMU could improve on programs they offer to help

educate college students along their academic and financial journey. Also CMU should and

prioritize in helping students who are currently facing financial insecurity’s by offering support

and resources to those who need it. Lastly CMU should consider and sympathize for students

who are not able to pay for college, and provide better payment systems to where a student could

feel confident with their financials in both a social and academic setting. If Central Michigan

provides these request then the major problem of students who face financial stress will no

longer have to. This in return will better CMU’s environment with happier students and better

performance. If nothing is done, then as we have seen, the trend of students going into debt will

only increase.
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References

Cost of attendance: Scholarships and financial aid. www.cmich.edu. (n.d.-a).

https://www.cmich.edu/offices-departments/office-scholarships-financial-aid/cost-of-

attendance

Devlin, D. (2016, November 14). How stress affects saving and spending habits. Rutgers

University. https://www.rutgers.edu/news/how-stress-affects-saving-and-spending-habits

Foundation For, E. E., & FEEGA. (2019, Aug 17). Why College Tuition Is so Expensive. CE

Think Tank Newswire https://cmich.idm.oclc.org/login?url=https://www.proquest.com/

wire-feeds/why-college-tuition-is-so-expensive/docview/2274980389/se-2

Hicklin, M. (2023, October 10). How do most people pay for college: BestColleges.

BestColleges.com. https://www.bestcolleges.com/research/how-do-people-pay-for-college/

Moore A, Nguyen A, Rivas S, Bany-Mohammed A, Majeika J, Martinez L. A qualitative

examination of the impacts of financial stress on college students' well-being: Insights

from a large, private institution. SAGE Open Med. 2021 May 22;9:20503121211018122.

doi: 10.1177/20503121211018122. PMID: 34094560; PMCID: PMC8141976.

Raja, S. (2023, March 16). College student spending habits for 2023. Lexington Law.

https://www.lexingtonlaw.com/blog/credit-cards/college-student-spending-habits.html

Saving money: Financial wellness collaborative. www.cmich.edu. (n.d.).

https://www.cmich.edu/offices-departments/mary-ellen-brandell-volunteer-center/

programs/financial-wellness-collaborative/saving-money

Sheppard, R. (2015, Oct 05). Saving Money In College. Benzinga

Newswires https://cmich.idm.oclc.org/login?url=https://www.proquest.com/wire-feeds/

saving-money-college/docview/1719016753/se-2
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Welding, L. (2023, September 25). Average cost of college textbooks: Full statistics:

Bestcolleges. BestColleges.com. https://www.bestcolleges.com/research/average-cost-of-

college-textbooks-statistics/

Why save for college?. CSPN. (n.d.). https://www.collegesavings.org/why-save-for-college