NEWS

Tackling student debt, promoting financial literacy

Posted 4/19/22

By EMMA BARTLETT

Cranston native Nathan Zarcaro got his start with personal finance at age 16. By 18, he opened his first retirement account and today, at age 25, Zarcaro is helping others …

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NEWS

Tackling student debt, promoting financial literacy

Posted

By EMMA BARTLETT

Cranston native Nathan Zarcaro got his start with personal finance at age 16. By 18, he opened his first retirement account and today, at age 25, Zarcaro is helping others understand their finances with his company The Student Debt Roadmap Destroyer. In an attempt to increase accessibility to student loan help and assist people with their student loans before the federal moratorium on student loan debt ends August 31, Zarcaro is offering free student loan plans through his website until the end of April. 

“Between the pandemic and high inflation numbers, it has been a tough couple of years for everyone, but especially for those with student loan debt,” said Zarcaro, who now resides in Connecticut. “I wanted to find a way to help people out in a new way.”

Zarcaro knew the feeling of being financially burdened. At 23, he was $24,000 in debt and had no idea what his next course of action should be. He did not have a job he was passionate about and had lofty financial goals with no way to reach them.

Zarcaro’s company is a year old and assists Americans across the country. His target audience tends to be between the ages 25 and 45 – noting that his “sweet spot” is 30 to 40 year olds.

As for why Zarcaro started The Student Debt Roadmap Destroyer, the answer was simple.

“Just that general sense of being passionate about personal finance from a young age, developing personal finance skills and seeing friends and colleagues and former roommates really struggling with the burden of student loan debt,” said Zarcaro.

Zarcaro said student loan debt continues to be a major issue nationwide, and it is now believed that there is about $1.8 trillion in outstanding debt nationwide. 

So far, the response to the student loan planning has been positive, and Zarcaro said people are surprised at the level of individuality provided. Zarcaro manually reviews responses and – based on the criteria and answers – creates a list of up to 10 loan plan options. The company is fully remote, which Zarcaro said has been helpful. When meeting with clients, he seeks to have them leave with a planning document and the confidence and understanding of what their next steps are.

As for the time commitment on the loan payer’s end, individuals complete a 10 minute quiz with 15 questions concerning their loans.

Zarcaro said school debt is a unique beast and to give it all the attention it deserves. He said except in rare instances, it’s the only type of debt that won’t be discharged in the case of bankruptcy. He says he loves to help people understand that student debt is in no way a death sentence.

As for long term goals, Zarcaro is in the process of developing a more formal five-phase coaching program for student loan debt which will launch this summer.

“The goal is to get you excited and comfortable with the path to more forward,” Zarcaro said.

Additionally, he’d like to find ways to partner with organizations – or start his own – to not only promote financial literacy in schools but affect that change on a national level. In June 2021, Rhode Island enacted legislation to ensure students receive financial literacy courses before graduating high school. He wants to get to the root of the issue, so the problem doesn’t have to occur in the first place.

Zarcaro also has a 130-page ebook, “Grow Your Green: Financial Self-Help from America’s Favorite Generation” which covers personal finances with concepts such as debt repayment.

“I’m trying to light that fire of ‘if you haven’t started investing why it’s important you start now’,” Zarcaro said.

 

Promoting financial literacy

Marcy Reyes, 40, came from a household where culturally, her family did not talk about money. It was a taboo subject and considered something that adults dealt with and kids were not involved in. Reyes, who grew up in Providence and moved to Cranston four years ago, said she didn’t have money lessons and made a lot of mistakes until she took a personal finance class at Rhode Island College. That class changed everything and led to her creation of the Financial Literacy Youth (FLY) Initiative.

Reyes said once she was equipped with that information from her personal finance class, it helped with saving for a new car and getting through graduate school. Reyes then went on to teach personal finance at RIC.

“Everyone was just like me when I was in that class,” said Reyes.

The FLY Initiative launched in 2017 with three years of research and planning behind it. Reyes compiled a program focusing on not only financial education, but financial capability that would have students leave with a sense of confidence.

The FLY Initiative’s belief is that students should have access to financial literacy resources regardless of race, ethnicity or socio-economic background. By providing students with the knowledge and skills to manage financial resources effectively, they give students the opportunity of a lifetime of financial well-being to end generational poverty. Through research, she found that 90 percent of the students taking financial literacy classes in high school were white and determined there was a need to reach Black, Indigenous People of Color (BIPOC) students as well.

When creating her financial literacy roadmap, Reyes looked at other organizations’ financial literacy topics that were nationally recognized, with methods that were proven tried and true. She ended up with ten core components that were separated into modules.

As for particular topics that students found most helpful, Reyes said helping students understand credit card management and how to manage/avoid debt are among the most effective lessons. The information is also helpful for students who are figuring out how to pay for college – such as accumulating funds from scholarships and grants. The goal is to graduate with as little debt as possible and through financial literacy, students have the upper hand.

The students Reyes and her team assist receive a variety of access to tools. There are networking opportunities, access to online materials, a two-week bootcamp program and evening classes.

After two uncertain and stressful years due to the pandemic, research from Rhode Island’s Junior Achievement and Citizens Bank finds high school students are worried about their financial futures – with 54 percent saying they feel unprepared to finance their futures.

“In order for students to feel confident financially it’s critical to equip them with the skills and knowledge to make sound financial decisions,” announced Chris Ebeling, Head of Student Lending, Citizens in an April 6 press release. “Coming up with a strategy to pay for college can be daunting, but financially empowering students and families can help them for the rest of their lives.”

The study surveyed 1,000 teens between 13 and 18 years old this past February, with 69 percent of them saying that rising education costs have affected their plans for education after high school; 28 percent said they are now only considering in-state schools while 22 percent plan to live at home and commute to college.

“Empowering students and families financially can help them for the rest of their lives,” said Kim Dee, Executive Vice President, Head of Retail Branch Network, Citizens. “In order to ease uncertainty and ensure that teens have the confidence to make sound financial decisions, it’s critical to equip them with the skills and knowledge they need through increasing access to educational resources and providing hands-on training.”

While Reyes’ intention was to work with high school students, the program has expanded to include middle schoolers, young adults and adults. The key is to tailor the program to the specific age groups. She said she has explained compound interest and what is credit management to middle schoolers by simplifying the content into digestible points and including games.

Reyes helps those who are in the beginning of their personal finance journey, in the midst of their journey or struggling to make decisions. Cultural background is an important factor and the FLY Initiative has BIPOC educators who relate to the students they serve.

The FLY Initiative recently expanded to a team of five full time staff and two part time staff members – previously it was just Reyes. The board of directors is 50 percent BIPOC, so there is healthy representation on the leadership level. Reyes said FLY has served 1,000 students in the past year and the organization's goal is to assist 7,000 individuals by 2024. The organization has partnerships with Lifespan, the Rhode Island Black Business Association, The Paul Cuffee School, The Met High School and the Boys and Girls Clubs of Pawtucket.

With the recently passed legislation requiring Rhode Island schools to offer financial literacy classes for students, Reyes said the FLY Initiative can come into schools and fill that requirement without any heavy lifting on the schools’ end. The FLY Initiative would provide the school with an accredited educator and a nationally certified curriculum.

“Information is currency, and if students don’t have this information, we’re robbing them of the financial opportunity of success. That’s a social justice issue,” Reyes said.

student debt, financial literacy

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