A man checks stocks on his phone while working at his computer.

The University of Michigan wants all 30,000 undergraduate students to open investment accounts and save for retirement early. The public university recently partnered with financial service Vanguard to provide investment education and access to low-cost IRAs for students interested in getting a head start on long-term financial planning.

“We’re trying to empower students to make good financial decisions and avoid being caught off guard by the huge responsibilities they face after college,” said Sally McCarty, senior director of student financial literacy at the University of Michigan. The program aims to give students the knowledge and tools they need to build financial security and achieve important life goals.

The program will start this fall as an optional offering but could eventually become a degree requirement for all students. Financial wellness is increasingly recognized as vital to students’ success, health, and prosperity like their academic preparation. Still, many studentsgraduate college without learning essential financial concepts or developing sustainable financial habits.

By providing investment education and access, the university hopes to give students an advantage that could benefit them for decades. Interest earned in retirement accounts today could help fund life goals decades in the future. Students will learn from experienced financial advisors and get started with an initial deposit of just $50.

While the Vanguard partnership specifically focuses on long-term investing for retirement, financial wellness encompasses many important topics. The larger goals are equipping students with knowledge of budgeting, paying off debt, taxes, insurance, goal-setting, and more — all of which influence well-being and ability to achieve life milestones. Some students may need basic financial counseling or advice addressing credit issues, for example.

With student loan debt exceeding $1.5 trillion nationwide, financial preparedness is increasingly urgent. Partnerships between universities and financial companies could help develop innovative solutions and shape a new generation of financially savvy individuals. When students graduate with more than just a degree, the impact on communities and society at large can be profoundly positive.

By making investment education and access standard, even mandatory, the University of Michigan hopes to move the needle on student financial wellness and opportunity. While the program starts small, the potential to transform students’ financial futures and well-being is big. With time and scale, approaches like these could dramatically improve financial security for students and set them up for success in life beyond college.


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