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Students at McPherson College who opt in to a financial wellness program receive institutional financial support for their on-campus work experiences.
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Most students expect their earnings to go toward paying for college, but few can say their colleges are matching that investment in their future. At McPherson College in Kansas, students who opt in to the Student Debt Project receive educational and financial support from the institution to benefit their overall financial well-being and help minimize their student loan debt.
The project launched in 2017 and has helped hundreds of students improve their knowledge of financial health and smart budgeting as well as set them up for future success with less debt.
What’s the need: Student loan debt is one of the top concerns for incoming students and their families. Sixty percent of parents and guardians say the cost of higher education is their top concern when sending their children to college, 40 percent identify scholarships and 39 percent say debt is a top priority.
Among young adults, roughly two in five say they’re barely scraping by (25 percent) or completely underwater financially (13 percent), according to data from Morning Consult.
Student loan debt can also stick with learners, hindering their future success. Recent research found around 7.2 million Americans over 50 years old hold student debt, and around one-quarter of Americans who currently have debt don’t expect they’ll ever be able to pay it off.
The Student Debt Project at McPherson is one way its leaders hope to increase affordability for students without reducing tuition rates or overall costs for the institution, according to a 2021 news story.
How it works: The Student Debt Project has three key areas.
- Employment. Students commit to working part-time in college, and then payments that they make on their student accounts from earnings are matched by the college at $0.25 per dollar.
- Mentorship. Students meet regularly with mentors who provide insight into budgeting and other finances. The over 60 mentors are alumni and friends of the college who provide individual and small group support virtually or in person. Upper-level students can also be near-peer mentors.
- Financial literacy. Workshops provide skills and education around financial wellness to students.
Private donors have helped fund the Student Debt Project.
To participate in the program, students complete an application, which is reviewed by the Student Debt Project team. Students then receive a budget worksheet to outline how the initiative supports their financial wellness and how much they’ll need to earn per year to graduate with less than $10,000 in loans. Any student is eligible to apply, incoming or returning.
During orientation, students create a budget that they continue to track throughout the school year to identify income, expenses and how payments and matches can reduce their need for loans.
The impact: In 2017, six students participated in the pilot. During the 2023–24 academic year, over 400 students were in the program, or around half of the undergraduate population, according to the college’s website. As of fall 2024, the college anticipates a total of over 600 students participating in the project.
In 2021, the college allocated $93,001 to match student contributions, reflecting $373,445 of student allocations. In 2023, the college matched more than $300,000.
Each student participating has reduced their debt at graduation by around $10,000 in one year, as well, which could continue for those who still have additional years at the college. Thirty percent of graduating seniors in the Class of 2024 had zero debt, thanks to the project.
Additionally, students who participate have maintained a higher-than-average GPA of 3.3, compared to other students who are employed while in college. In 2022, the average debt at graduation was $16,700 (McPherson tuition and fees for the 2024–25 year total $47,250). The program has also promoted retention, with 93 percent of participants returning to the college each year.
The initiative supports historically marginalized student groups, as well. Among participants, around 10 percent are first-generation students, nearly half are racial or ethnic minorities or international students, and 40 percent are eligible for Pell Grants.
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