Financial planning strategies of high school seniors: removing barriers to career success.

Author:Poynton, Timothy A.

This study explored the postsecondary financial planning of graduating 12 th graders as a barrier to educational and career decision making and success. Seniors planning on pursuing postsecondary education (N = 744) from 16 high schools completed an online survey measuring their plans for financing their postsecondary education. They also provided information regarding their academic achievement, motivation, certainty, and postsecondary goals and plans. Students clustered into 4 distinct financial planning strategy groups. These financial planning clusters were evident across a diverse sample of high schools. Almost half of all graduating 12th graders had limited financial planning strategies. Groupings and strategies employed by students were significandy related to career development theory and research. The critical role for career development services in promoting student success is discussed.

Keywords: financial planning, college and career readiness, postsecondary transition, barriers, supports


The cost of postsecondary education has risen sharply, making it one of the most important challenges to the college and career decision-making process for students and their families. The National Center for Education Statistics (NCES, 2012) reported that between the 2000-2001 and 2010-2011 academic years, the prices for undergraduate tuition and room and board increased 42% at public institutions and 31% at private not-for-profit institutions--after adjustment for inflation. Since 2008, Sallie Mae (2012) has conducted annual surveys of college students and their parents that focus on the types of funding sources utilized (e.g., family savings plans, scholarships, loans), the actual amount associated with each funding type, and the college decision-making process. In the 2011- 2012 academic year, 69% of students reported eliminating a college they were accepted to because of cost--a figure that has increased annually since 2009, when 56% of students reported eliminating a college they were accepted to because of cost. This reality is being felt and responded to by students across the socioeconomic spectrum. For example, there has been an increase in students from families that earn more than $100,000 a year who are deciding to live at home while attending college as a cost-saving measure--from 24% in 2010 to 47% in 2012 (Sallie Mae, 2012).

The financing of postsecondary education as a barrier to educational and career success has become a focus for career development theory and research. For example, Lent (2013a) argued that one of the most useful aspects of social cognitive career theory (SCCT) is that it can be employed to help people develop the "career-life preparedness" skills necessary to minimize barriers and strengthen supports for educational and career attainment. Financing postsecondary education is, in the SCCT choice model, one of the most challenging proximal environmental influences affecting the setting and implementation of career choice goals (Lent, 2013b).

Previous and emerging research support this emphasis on finances as a major impediment to the career choices and success of college students (Lent, Brown, Talleyrand, & McPartland, 2002), including career choices in science, technology, engineering, and math (Fouad et al., 2010). McWhirter and her colleagues have consistently identified funding for postsecondary education (e.g., loans, financial aid, and scholarships) as one of the most critical barriers to career success, especially for minority women (McWhirter, Torres, Salgado, & Valdez, 2007) and lower income and underrepresented Latina/o youth (McWhirter, Luginbuhl, & Brown, 2014). Furthermore, a lack of financial planning and preparedness has been linked to greater rates of dropping out of college (Ishitani & DesJardins, 2002). Students with greater financial need are less likely to persist at their chosen schools (Wessel, Bell, McPherson, Costello, & Jones, 2006), and the difference between what the financial aid students expect to receive versus what they actually receive shapes college choice, access, and success (Kim, DesJardins, & McCall, 2009).

Increasing high school seniors' readiness for, access to, and graduation from postsecondary education has become a leading national priority (U.S. Department of Education, 2010). Research has made significant progress in better understanding potentially malleable factors that promote successful postsecondary transitions for graduating high school seniors (for a review, see Lapan, Turner, & Pierce, 2012). Interdisciplinary research has found that the readiness to succeed in college (i.e., access, retention, performance, and graduation) relates strongly to demographic, academic, motivational, and career planning factors. Demographic factors such as sex, ethnic minority status, socioeconomic status (SES), and speaking languages other than English at home are consistently associated with postsecondary outcomes. For example, bachelor's degree completion rates among eighth graders who aspire to at least a 4-year degree are higher for women than for men, and for Asian American students when compared with students of all other ethnicities (Trusty & Niles, 2004). Female high school students may anticipate more barriers to financing postsecondary education than male students, and Mexican American high school students anticipate encountering more barriers to postsecondary success than White high school students (McWhirter et al., 2007). When predicting Holland types of college students with declared majors, a three-way interaction exists among gender, SES, and ethnic minority status (Trusty, Ng, & Plata, 2000). Spending more time working on high school assignments, earning good grades, and taking demanding courses that hold students to high academic standards are academic-related skills necessary for postsecondary success (American College Testing, 2007).

Purpose of the Study

Motivational factors such as achievement motivation, connectedness, a sense of personal belonging in school, interpersonal relationships and skills, and perceptions of safety are strongly linked to critical markers of student postsecondary success. These markers include college grade point average (GPA) and retention, as well as lower rates of risky in-school and out-of-school behaviors such as drug use and driving while intoxicated (e.g., Centers for Disease Control and Prevention [CDC], 2009; Lapan, Wells, Petersen, & McCann, 2014; Robbins et al., 2004). Meanwhile, career planning and development attitudes, behaviors, and decisions (e.g., short- and long-term educational goals, certainty, completing a free application for federal student aid [FAFSA], and applying to multiple colleges--especially for students with more marginal academic records) explain unique and meaningful portions of the variance in successful transitions to postsecondary education and persistence to graduation (Allen & Robbins, 2010; Lent, 2013b; Roderick, Nagaoka, Coca, & Moeller, 2008).

Therefore, our study examined how graduating 12th graders plan to finance their postsecondary education and assessed the extent to which career development factors linked in prior research to college and career readiness influence and interact with these financial plans. Research has demonstrated how demographic, academic, motivational, and career planning factors influence and interact with career planning and postsecondary success. However, the role of financial planning in career planning and postsecondary success has not been comprehensively examined. We expected that the specific approaches to financing postsecondary education adopted by graduating 12th graders would reveal clusters of students based on these plans, given prior research linking demographic factors to career planning and postsecondary success. Furthermore, we expected that these clusters would differ on academic, motivational, and career planning factors in ways similar to previous research linking these factors to postsecondary success. Having an increased research-driven understanding of the role of financial planning in the high school-to-college transition would greatly assist educational leaders and policy makers to design more effective systems of support for both students and their families.


Hypothesis 1. Graduating 12th graders will cluster into distinct, homogenous groups based on their plans for financing their postsecondary education.

Hypothesis 2. If Hypothesis 1 is supported, it is predicted that groups will differ significantly from each other on key demographic factors, academic achievement factors, motivational factors, and career development factors.

Hypothesis 3. If hypothesis 1 is supported, a model of student characteristics can be developed to explain differences between graduating 12th graders with the lowest levels of financial planning preparedness and those with more defined approaches.



Data were collected in late April and May of 2012 on 744 graduating 12th graders attending 16 high schools across one northeastern state. The racial composition of the sample was 72% White, non-Hispanic; 13% Hispanic; 5% Black, non-Hispanic; 4% Asian/Pacific Islander; and 6% other. More female (54%) than male (46%) students participated in the study. Participants reported that approximately 8% of their parents or guardians did not graduate from...

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