The size of the debt burden on college graduates who took out loans to help pay college tuition and related expenses has been well documented, having exceeded a trillion dollars a few years back, but a new game may help students prepare for how they will pay for college and, perhaps more importantly, pay back any loans they have to take out in the process, the New York Times reports.
The online game is called “Payback,” and it’s the work of McKinney. Author Tim Ranzetta says as a student loan counselor, he had talked to countless students over the years and was concerned that many of them didn’t know how student loans worked. These were, after all, the people who were using the loan products: high school students and young adults who didn’t really get the whole financial literacy puzzle.
“To summarize, 54% of students didn’t know the monthly payments associated with the student loans that they were taking out and 53% indicated that [knowing] would make a change to their decision about taking out loans,” his company’s website says. “High school educators, please take this incredible opportunity to educate your students about financial aid and how to pay for college. Ensure that your students don’t regret decisions they made because no one provided them the information and the tools to make the right decision for themselves.”
When they play the game, students see running totals of their debt, of course, as they pay for college. But what is critical about this game is that students can also track other, non-financial, factors. Concepts like academic focus, networking and connections, and overall happiness—these all play a role in students’ ability or inability to pay back their student loans after they enter the workforce. They also play a role in determining how successful students will be in college or even if they’ll graduate with the degree they’re investing so much money in.
In turn, all of this together determines how successful students will be in paying back their loans, not to mention how happy they’ll be in their post-graduate lives.
Game players make a series of decisions—picking a college, getting a job, joining (and paying for) a fraternity or sorority—and the software gives them the experience of being there, without any real consequences in the game. They can see how different decision paths will play out, in other words, and change their course if necessary or desired.
Ideally, high schools would teach all college-bound seniors about this aspect of financial literacy. Otherwise, they’ll be thrown to the wolves in the confusing world of college financing.