At the Center of a Financial AWAKENING

John Pelletier

Champlain College LEADs the Way to A Rational Relationship with Our Wallets

Last December in Roger H. Perry Hall, President David F. Finney stood up before a packed room to unveil the College’s latest project — The Center for Financial Literacy at Champlain College. He introduced its director, John Pelletier, who up until that day was a bit of a mystery man to most people on campus.

The morning news conference was the culmination of a 10-month whirlwind journey for Pelletier, who in seeking a change of lifestyle and looking for new challenges, decided with his wife that they would relocate with their three young boys to Stowe and he would start his own consulting business. His previous work for nearly two decades had been in Boston serving as the chief operating officer and chief legal officer at some of the largest U.S. asset management firms, including Natixis Global Associates, the owner of Loomis Sayles and Oakmark Funds. It was time for a change, he felt, in both his work and his personal life. It was time to step away from the rarefied business and trading world where dollars are counted in billions. Time to find a way to help prevent a repeat in the future of the economic turmoil suffered by businesses, families, and individuals who made poor financial decisions resulting in the Great Recession of 2008-09.

It was time to step back and make a difference.

Pelletier’s idea was simple on the surface—figure out a way to make people smarter about how they handle their money. Starting at an early age in school, teach them how to use credit wisely, encourage them to save for the things they want, and give them the tools to make sound decisions about things like job benefits, mortgages, and retirement plans. Make sure college graduates have the life skills to make good career decisions and help adults save and invest wisely.

In researching his next steps, he found a serious lack of financial principles being taught in schools at all levels, from kindergarten to college. “A direct result of our nation’s poor personal finance knowledge has been a record number of foreclosure rates, mortgage defaults, personal credit defaults, and bankruptcy rates,” he said. “Some of our economic problems were created by bad actors focused on personal gain, but so many others were created by good people making poorly informed personal finance decisions.”

In his search for a partner institution, he approached several larger higher education institutions in Vermont with his idea. The same thing happened repeatedly, he said. “They loved the idea, but kept saying that if I really wanted to see my idea for a financial literacy center become a reality, I should go and talk with Dave Finney at Champlain College. They said Champlain was ’entrepreneurial, innovative, and creative’ and was much more nimble than they were.”

About the same time, Champlain College was already pursuing its own mission to equip its undergraduate students with a set of lifelong skills, including financial sophistication, through Finney’s new campus initiative known as Life Education and Action Dimension (LEAD).

“It was clear to me that John’s vision for the center was a perfect fit with Champlain College’s focus on practical life skills for our students,” Finney said of their first meeting. Quick approval for the partnership followed that first meeting—though it came with its own financial caveat—Pelletier would need to find funding for the center’s programs and aim to be self-sustaining after 24 months.

Finding Supporters

So last August, with the help of Greg Morgan from Champlain’s Office of Advancement, Pelletier reached out to numerous Vermont financial institutions to explain his plan to improve Vermonters’ personal finance knowledge beginning in elementary school and continuing through high school, college, and adult education.

He used his simple Powerpoint presentation to show potential supporters the alarming national and state statistics on how little most people know about handling their money. He pointed out that in Vermont, the average college loan debt for a graduating college senior in 2008 was $25,047—the eighth highest in the nation. Equally troubling, he said, were adult behaviors—30 percent have no savings, 58 percent haven’t tried to figure out how to save for retirement, a third were “surprised” by the terms of their mortgages.

In fact, only four states mandate a one-semester high school course in financial literacy; Vermont is not one of them. A study of educators found almost two-thirds of K-12 teachers felt unqualified to teach to their state’s financial literacy guidelines and only 28 percent were even teaching the subject, usually as part of another course.

The most powerful slide, however, may have been the last one, in which Pelletier challenged the status quo: “We teach our children to look both ways before crossing the street, to buckle their seat belts and avoid talking to strangers, all good advice with regard to physical dangers. We need to do the same thing when it comes to teaching our children about the financial dangers they will face.”

“It is truly heartwarming to see financial firms that compete with each other every day in the marketplace join hands in supporting the cause of enhancing the financial literacy of Vermonters,” Finney said at the center’s unveiling.

Initially, the Center for Financial Literacy’s three programs will address the growing needs for financial education and increased literacy for K-12 students, college students, and adults in Vermont.

Sharing the Wealth of Information

As word about the new Center for Financial Literacy and the progress of the required LEAD financial workshops started to spread beyond Vermont, the news caught the eye of New York Times reporter Ron Lieber, who visited the campus in early December to see for himself what was going on. He flew up from New York City to spend a day on campus, meet with students in the LEAD program, talk with Shelli Goldsweig, director of LEAD, and attend a LEAD workshop with students on the basics of credit.

In his January 8 “Your Money” column, he singled out Champlain College for making the commitment to giving students the tools they need to make good financial choices. The situation at Champlain is unique, Lieber wrote, suggesting that other higher education institutions would do well to follow Champlain’s lead, especially in the area of requiring students to attend a “financial sophistication” workshop.

Lieber seemed even more surprised at who was actually teaching those workshops, noting, “Champlain has chosen to train students to teach its introductory class on credit, a strategy that is fraught with all sorts of danger given how complicated the topic can be. I was impressed, however, with the student teachers I quizzed, and the materials they share with their fellow undergraduates were 100 percent accurate as well.”

While only two workshops are required—one on budgeting and another on credit—the Champlain LEAD team, along with its partners Champlain Housing Trust and the Center for Financial Literacy, is expanding its workshops to include topics such as paying student loans, buying a car, and employee and job benefits.

This March, a number of students, mostly seniors, took advantage of the “What’s My Score?” credit report program and learned their credit score numbers and met with a financial counselor to review the information.

Compounding Interest

Following the publication of the New York Times piece, news outlets across the country began contacting Champlain College to talk about the programs. Reporters from Chicago, San Francisco, New York, and Florida cited the Champlain financial literacy programs and often held Champlain up as a national model for what other colleges and educational institutions should consider doing.

The New York Times story intrigued Merrill Lynch executives who were looking for an expert in the field of young people and finances who could join a panel discussion, led by former ABC News anchor Charlie Gibson, to talk about young adults and retirement plans.

In early March, Pelletier flew out to San Francisco to participate in a one-hour online broadcast with fellow panelists Roland Fryer, the Robert M. Beren Professor of Economics and CEO of the Education Innovation Laboratory at Harvard University; Anya Kamenetz, author of Generation Debt and DIY U, and staff writer at Fast Company; and Andrew Sieg, head of Retirement Services, Bank of America Merrill Lynch.

The Help2Retire broadcast (which is available online), also features video interviews with more than a dozen current Champlain students and recent alumni talking about their plans for retirement. Not surprisingly, many of the students said the pressure they feel to find a job and begin paying off their student loans often preempts thoughts of saving for retirement.

The film crew who interviewed the students also produced a 2½ minute video about Pelletier and the LEAD courses, showing numerous campus scenes and students.

“If I were king for a day, I would mandate that every high school student be required to take a personal finance course and, frankly, I would think the same would be true at the collegiate level,” Pelletier says in the video. “We do have a program where we will be teaching K-12 teachers to give them the confidence, the skills, and the curriculum tools that they need to go back into the classroom and to teach this to our children.”

Looking ahead

While it has been a busy six months since the official announcement of the center, Pelletier still has two of his center’s signature programs ahead this summer. The Vermont Financial Literacy Summit is a one-day conference designed to raise Vermont’s awareness of financial literacy issues and begin a discussion on the public policy choices related to creating a robust personal finance education program for all ages. Senior policymakers, senior educators, businesspeople, and nonprofit leaders will examine the lack of personal finance education in Vermont’s K-12 schools, colleges, and workplaces when they gather at Champlain College on June 16.

“We hope to tap into the collective wisdom of the attendees to gather ideas on how best to bring personal finance education into our schools, colleges, and workplaces in effective and efficient ways that will directly benefit Vermont’s economic competitiveness and vitality,” Pelletier told the Vermont House and Senate Committees earlier this year.

Among the speakers at the June event are Ted Beck, the president of the National Endowment for Financial Education and a member of President Obama’s Advisory Council on Financial Capability; John Gannon, the president of the FINRA Education Foundation; a senior representative of Vermont Governor Peter Shumlin’s administration; and U.S. Secretary of Education Arne Duncan via a taped message.

Champlain College students the studying video game industry and working through the Emergent Media Center will present a financial literacy game concept suitable for online or mobile use at the Summit.

The center will also discuss the results of its 2011 survey looking at how financial literacy is being taught today in high schools, leading to the third program, the Vermont Teachers Financial Literacy Summer Institute, scheduled for August 1-5. The institute will train Vermont middle school and high school teachers on how to teach the subject with confidence and how to use skills and curriculum tools to successfully teach personal finance in their classrooms.

The Summer Institute will grant three graduate degree credits to teachers who successfully complete the program and will feature a national curriculum pilot program created by a steering committee made up of the Jump$tart Coalition, the National Endowment for Financial Education (NEFE), the Council on Economic Education, Family Economics and Financial Education program (FEFE), the FDIC, and the U.S. Departments of Treasury and Education.

“This potential relationship gives Vermont the opportunity to be a national leader with regard to teacher training on financial literacy,” Pelletier said.

“It is my hope that within a decade, Vermont will be viewed by the nation as a leader and innovator in financial literacy education,” he told Vermont legislators earlier this year. “And that we would be able to review the following list of accomplishments:

• Personal finance education and assessment would exist in all of our middle and high schools
• Teachers would be given the personal finance training and curriculum that they need to be successful
• College students would be required to take a personal finance course or pass a test to prove their personal finance knowledge
• Our community colleges would offer personal finance courses to all of our citizens free or at subsidized rates
• Employers would receive tax credits for offering personal finance workplace training

This ambitious vision is possible if we create a strategic plan for Vermont’s financial literacy education program.”

Visit for more information about the Champlain Center for Financial Literacy.

LEAD’s Financial Literacy Workshops

Champlain College students have the following workshops available to them through the LEAD program in their junior and senior years.

• Understanding Employee Benefits: Helps students understand employee benefits and how to obtain the most value out of them when negotiating a job.
• Goal Setting & Budgeting: Looks at the core financial topics of budgeting and goal setting in a nonjudgmental environment. Provides students with tools they can use to set and stick to a personal budget, track expenses, and accomplish financial goals.
• Repaying Your Student Loans: An introduction to the options students have in repaying their student loans. Students learn about deferments, forbearances, income- based repayment, and other tools to decrease stress in relation to paying loans.
• Understanding Credit Part 1: An introduction to what goes into a credit report and credit score, as well as the influence it has on students’ lives.  Participation qualifies students to take part 
 in the What’s Your Score? free credit review day to get a free copy of their credit report and score as well as a 20-minute professional analysis of both.
• Understanding Credit Part 2: A closer look at credit reporting and scoring. By using sample credit scores, students learn how to repair and/or build toward a stronger credit report and score.
• Making Your Money Work for You: Students learn the benefits of starting to 
 save for retirement early, as well as different types of retirement accounts available. They also learn about the  difference between stocks, bonds, and  mutual funds and the risks and trade-offs associated with each type of investment.   
• Buying Your First Car: Students gain an understanding of the basics of credit, negotiating, budgeting, and loan documentation as they apply to buying a first car.