Money

The President's View - Fall 2017

Anonymous — Fri, 01 Sep 2017 11:15:01 +0000

The President's View - Fall 2017 Anonymous (not verified) Fri, 09/01/2017 - 05:15

Bruce D. Benson

The Best Investment

As a student at �� Boulder in the early 1960s, when costs were far lower than today, I financed my education by working on and off campus during school and over breaks to augment my family’s small contribution. It’s rare for today’s students to be able to do what I did.

Loans are common now and student debt is an issue. Yet it’s important to consider loans as an investment rather than just a cost. �� is focusing on educating our students about debt and ensuring they have tools to help them understand and manage it.

At �� Boulder, some 58 percent of bachelor’s recipients graduated with debt in 2015. The average debt load was $26,519, below the national average of $28,100. Our graduates’ loan default rate was 2.7 percent; the national average was 11.8 percent. This tells me our graduates are getting jobs and paying off their loans.

We are educating students about debt and finances. Before prospective students even arrive, we engage them with tools like our Aid Estimator, which projects the cost of education. For current students, the Council of Graduate Schools and TIAA funded an initiative to enhance their financial literacy. Several campus offices are collaborating on a program where students create financial plans to determine what type of financial information they need. We identify at-risk borrowers and tailor programs and outreach to assist them.

Declines in state funding increase costs to students, so we continue to work to keep a �� education affordable by finding efficiencies, instituting better business practices and trimming bureaucracy. We realized some $32 million in savings and cost avoidance last year and $40 million the previous year.

A college education is perhaps the best investment a person can make, paying financial and other dividends for decades. Most estimates show a bachelor's degree is worth $1 million or more over a wage-earning life. College graduates also tend to be happier, healthier and participate more in community and civic life. Loans are an unfortunate part of financing college for many, but for an investment that is less than the cost of most new cars, graduates reap a lifetime of benefits.

Illustration by Melinda Josie

President Bruce D. Benson's column from the fall 2017 issue.

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Look: Old Money

Anonymous — Thu, 01 Sep 2016 17:30:00 +0000

Look: Old Money Anonymous (not verified) Thu, 09/01/2016 - 11:30

Eric Gershon

Money Talks

A nation’s currency reflects its society, not just its economics, and design changes can signal social progress.

In 2020, for instance, the United States Mint plans to reveal designs for the first bills in more than a century to show a woman and the first ever to show an African American. Harriet Tubman, once a slave, will replace Andrew Jackson, the slave-owning seventh U.S. president, on the front of the $20 bill. Redesigned $10 and $5 notes also will incorporate women.

Other currency updates clearly broadcast awful times. Take the 500 million mark Reichsbanknote from the �� Heritage Center’s collections (pictured above). Issued by the Weimar Republic in 1923, it reflected runaway inflation in post-World War I Germany, which aided the rise of Adolf Hitler.

The bill, which possibly belonged to �� President George Norlin, wouldn’t have bought much: By November 1923 a loaf of bread in Germany cost 200 billion marks. So there was a 100 trillion mark note, too.

The Heritage Center’s small but varied currency collection also includes an American Revolution-era $30 bill and a $50 Confederate States of America bill (both pictured). They may be viewed in person by appointment with the curator.

Photos courtesy �� Heritage Center

It talks volumes.

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Thanks for the Record-Breaking Year!

Anonymous — Thu, 01 Sep 2011 06:00:00 +0000

Thanks for the Record-Breaking Year! Anonymous (not verified) Thu, 09/01/2011 - 00:00

Staff

Amid a limping economy, �� alumni and friends rallied to support the university, giving a record-breaking $213.2 million during the 12 months ending June 30, 2011. More than 47,000 donors made gifts to all four �� campuses — Boulder, Denver, Anschutz Medical Campus and Colorado Springs. The Boulder campus brought in its fourth highest annual amount, $46.9 million.

The great news follows on the heels of ��’s $1.5 billion Creating Futures campaign announcement in April.

As state support rapidly decreases �� must maintain excellence while finding alternative sources of funding, including relying more heavily on private donations. It receives less than 7 percent of its funding from the state, the third lowest in the country. Last year the Boulder campus lost $22.3 million in state funding.

Donations do not replace the need for operational funds to keep the lights on and pay salaries. But they enable the university to maintain its standard of excellence.

“Private contributions allow us to enhance the quality of our academic programs, research and student experience, so we appreciate the generosity of all our donors,” says �� President Bruce Benson (Geol’64, HonDocSci’04).

Amid a limping economy, �� alumni and friends rallied to support the university, giving a record-breaking $213.2 million during the 12 months ending June 30, 2011.

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By the Numbers - Fall 2010

Anonymous — Wed, 01 Sep 2010 06:00:00 +0000

By the Numbers - Fall 2010 Anonymous (not verified) Wed, 09/01/2010 - 00:00

Staff

266,400 Size in square feet of Jenny Smoly Caruthers Biotechnology Building being built on east campus. 2011 Year the building will open.

$145 million Cost of the building. $60 million Amount �� has contributed. $30 million Amount raised in gifts. $15 million Amount of federal economic stimulus money received. 500 Number of graduate students and researchers who will work there. 60 Number of faculty who will work in it.

Fun facts in numbers from the Fall 2010 issue.

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Higher Education Provides Ongoing Return

Anonymous — Sun, 01 Mar 2009 07:00:00 +0000

Higher Education Provides Ongoing Return Anonymous (not verified) Sun, 03/01/2009 - 00:00

Bruce D. Benson

Perhaps the most overworked phrase in the recent election campaign was the “bridge to nowhere,” a reference to a proposed project in Alaska that became a metaphor for everything from crazy ideas to poor decisions. It’s getting new life as politicians and pundits debate the federal economic stimulus package, with proposed infrastructure projects as part of the discussions.

These projects are important to Colorado and the nation, both to strengthen our systems and to create jobs. To a limited extent, higher education is moving up the priority list in stimulus discussions, but it should be more prominent. While bridges certainly matter, they stop stimulating the economy the moment they are completed.

Higher education, on the other hand, is an investment that provides a critical, ongoing return. It allows us to produce the human infrastructure that will drive us out of recession and ensure our long-term success. Colleges and universities, particularly research universities, offer critical components of an economic recovery and future prosperity.

The University of Colorado is a perfect example. Our alumni contribute to communities around Colorado and across the country in myriad ways, from education, health care and business to the arts, elected office and nonprofit work. �� research drives new ideas in areas critical to our state and nation, including biomedicine, health care, renewable energy and space sciences. Universities are engines of economic activity and innovation. We create good jobs and educated workers to fill them.

Given our significant role in economic development and long-term prosperity, it’s puzzling to see the value that Colorado and other states place on higher education. Across the country, public colleges and universities are bearing the brunt of the poor economy. Just as we were beginning to recover from Colorado’s last recession, we will have to take more reductions. �� is bracing for tens of millions of dollars in cuts over the next 18 months.

Yet we must control our fate. We must convince the public and lawmakers of the value of higher education. We must show them that universities are economic engines that also produce the skilled work force we need. Each of us has a role in that endeavor. We have to spread the message with our friends and neighbors, with legislators and business leaders, in our communities and across the state.

And the message is that higher education is the bridge to economic stability and quality of life.

The president's column from the spring 2009 issue.

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Benson Says Give Us Dough or Let Us Go

Anonymous — Sun, 01 Mar 2009 07:00:00 +0000

Benson Says Give Us Dough or Let Us Go Anonymous (not verified) Sun, 03/01/2009 - 00:00

With severe state budget cuts looming, �� President Bruce Benson (Geol’64, HonDocSci’04) and other frustrated higher education leaders are asking lawmakers for the flexibility to raise tuition as they feel necessary.

“Give us the opportunity to control our destiny, especially if you’re not going to give us the money to run the place,” President Benson told the Denver Post.

Colorado consistently ranks 48th in the country for state support for higher education. As it stands, tuition increases must be approved by lawmakers, which Benson and others feel limits their ability to manage their institutions — especially this year when the state may slash higher education funding to cover the projected $600 million budget shortfall.

If �� and other state institutions became privatized, however, some critics worry low-income families would suffer, since the governor and lawmakers wouldn’t weigh in on tuition increases. Yet, others feel it’s not fair to simultaneously underfund higher education institutions while overburdening them with rules and regulations.

“We have three research institutions — Colorado, Colorado State and Mines — and frankly, every year we erode the quality of those institutions,” Rep. Jack Pommer (Phil’86), a Boulder Democrat, told the Rocky Mountain News. “If you have a house and can’t maintain it, why not just move instead of letting it deteriorate?”

With severe state budget cuts looming, �� President Bruce Benson and other frustrated higher education leaders are asking lawmakers for the flexibility to raise tuition as they feel necessary.

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Shopping with Donnie

Anonymous — Sun, 01 Mar 2009 07:00:00 +0000

Shopping with Donnie Anonymous (not verified) Sun, 03/01/2009 - 00:00

Doug McPherson

�� professor Donnie Lichtenstein checks out prices at Lucky's Market in Boulder.

Donnie Lichtenstein, a �� marketing professor, remembers looking in the newspaper as a young child and regularly seeing an ad for barbecue grills from Sears.

“They were always, always on sale. I thought, ‘How can that be? They can’t always be on sale.’ I guess my curiosity just grew from there.”

Fittingly perhaps, his curiosity has led to figuring out how merchants try to persuade consumers. And even though he’s considered a national expert in pricing – and won a lifetime achievement award for his work in behavioral pricing research – he still comes across as humble. He even admits he finds it hard not to get sucked in by all the tricks retailers can pull.

“I mean I study this stuff and when I’m out shopping I still find myself having to stop and say, ‘You know better,’ ” he says. “Retailers can be so seductive and very powerful. I’m not immune. I just try my best to hold their feet to the fire.”

One group that might feel the heat is grocery stores. He says they have gotten particularly good at separating shoppers from their cash. Over the past 20 years they’ve made sweeping changes to their stores with layouts, promotions, product placement and partnerships.

“Grocery stores have had to change to stay competitive – they’ve added a lot of tools to get shoppers to stay longer and spend more,” Lichtenstein says.

Examples include adding Starbucks and bakeries.

“The goal is to make the store a destination,” he says. “They want to make the store and shopping a more pleasant experience, and at the same time the new additions have good markups and margins, such as bakery items, soup bars and sushi counters.”

Homework in savings

Lichtenstein says when you first enter, for example, beware of those displays you see right inside the door and at the end of the aisles. In this grocery store there’s a six-foot stack of bottled water for $3.68 and an end-of-aisle display of Raisin Bran for $2.50 a box. Deals? Maybe. The key is the location.

“Grocery stores used to save these areas for specials and consumers took notice,” Lichtenstein says. “But it’s classical conditioning. Now stores will put the higher margin items in those places, but shoppers still think they’re a good deal.”

Lucky's Market worker stocks navel oranges at a price �� professor Donnie Lichtenstein couldn't pass up.

Lichtenstein pauses. He wants to talk comparison pricing. “I remember a couple of years ago I was looking to buy a tennis racquet. So I went to the store and remember seeing a sale sticker. The racquet was $300, but it was marked down to only $150. ‘Wow, half off,’ I thought. But then I caught myself and examined whether or not I thought the racquet was really worth that. Be careful not to fall into the comparison trap.”

Now looking down the refrigerated dairy aisle, little red stickers hang intermittently from shelves as apparent deals. But Lichtenstein warns of these signs, particularly the ones that say “Limit 6” or “Limit 10.” “When people see a limit on what they can buy, they automatically assume it must be a good deal,” Lichtenstein says. “But that’s not always the case.”

It’s easy to see Lichtenstein is in his element. He loves knowing the tricks. “I’ve always been a real deal-prone consumer,” he says. “After I buy something I like thinking about the bargain I got.”

He also likes teaching undergraduate and graduate students, as well as pursuing his research in marketing. “Marketing research is especially fun because I like to show students it can be applied to other areas like medicine and even elections. It’s the same science behind why a product can be made attractive to the public.”

He can’t resist another teaching moment. At the end of that aisle stands a nice lady behind a table who’s offering free tastes of yogurt. “If you try it, just know it’s a trick to make you feel obligated. It’s the reciprocity rule when someone gives you something, you feel obligated to repay them,” he says.

Do the math

But beyond the store’s little money-making land mines, Lichtenstein explains at the root sits an assumption that shoppers are lazy and won’t do the math or search out the bargain. Two examples: Most higher margin items are placed at eye level. The hypothesis is you won’t bend down to find a bargain. Grocers will highlight the prices of certain products even though they’re not the best price per ounce. The premise is you won’t compare price per ounce to find the better deal.

And therein lies an important shopping lesson, one he seems to want everyone to know: “Be alert and vigilant,” he says in a tone as if he’s speaking to a daughter who’s about to drive a car for the first time.

“Most people do shop in a mindless, spacey manner,” he says. “And many don’t pay attention to prices; most can’t tell you what they will pay for the ketchup in their cart. It’s work, so pay attention when you shop.”

Another tip: “Part of being a good shopper starts before you enter the store.”

He recommends coupons, especially for items you buy a lot. Lichtenstein buys coupons on e-Bay because he often finds multiples of coupons for products he buys regularly. And sometimes you can find coupons that aren’t in your Sunday paper.

“Just know a coupon can change the ratio between the price per ounce, so that 10 oz. bottle of ketchup might be a better buy than the 20 oz. bottle,” Lichtenstein says. “You can do better with coupons overall, but it takes effort.”

And create a “trip chain” by cherry picking stores with the best deals. It’s often worth the trip.

Something else that makes the work worth it – a good feeling.

“There’s something called transaction utility, which is basically knowing you got the best deal and that can be fun for shoppers; I know it’s fun for me.”

Donnie Lichtenstein, a �� marketing professor, is considered a national expert in pricing.

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