Crowd Funding Boosts Financial Aid and Financial Literacy
by FinancialCorps, 05 December 2015
Crowd funding is taking the financial education space to new heights, as organizations and individuals are leveraging the power of the internet and the fast growth and popularity crowd funding to seek solutions to the mushrooming student debt, financial aid and financial literacy challenges. In the latest development that has the financial education community buzzing, a group of University of Kentucky students have developed FinanceU, an innovative online tool focused on student financial aid.
The college debt crisis is characterized by a trillion dollar burden on college graduates who are struggling to make ends meet as they enter their post-graduation lives. FinanceU was developed and launched as a free platform that seeks to empower students to employ crowd funding to build their own scholarships.
The University of Kentucky students moved forward with their business sparked by knowledge that the university’s students carry an average debt load of approximately $17,000. By raising money through crowd funding, this debt can be lowered, possibly substantially, which would put those students on a more likely path to financial success earlier in their post-graduate careers.
FinanceU’s platform works through four simple steps. First, students create a profile and launch their own scholarship fund. Second, the scholarship web page is shared with the student’s contacts and social networks, which also highlight life events that could trigger greater donations, such as birthdays and graduations. Third, the funds raised are intended to grow through FinanceU’s products and services designed to help students achieve their financial goals. Finally, the funds raised are transferred to the college attended by the student and thereby offsets the expense of attending the academic institution.
Given the continued growth of crowd funding, combined with the increased understanding of the huge scope and problems associated with the student loan crisis, industry observers believe many other new and innovative crowd funding solutions will come to market with a goal of solving this challenge. That, in turn, will ignite an even greater focus on financial education so that students can understand not only the implications of student debt, but importantly, these various avenues that can solve the financial aid dilemma and launch the students on successful paths to managing their personal financial matters.