Your College Student is Heading Off to College.
What is the big learning?
How to live on your own, manage your time and pay your bills.
Parents want to provide their college-age son or daughter a credit card for needed expenses and emergencies only, and then are surprised at the bills their child is able to pile up in a short time. This can be tough on a family’s finances and especially the parent/child relationship.
The solution? Make “budgeting” and “money management” a key part of getting kids ready for college.
Below is some financial help for parents and their college students –- financial lessons to start now, even if your student is already halfway through their college career.
Budgeting and money management for college students
3 MUST DO’s:
(1) Insist they put together a budget.
(2) Allow them to create their own budget. Be available for any questions (or tears).
(3) Put the budgeted money in one checking account that your student manages.
STEPS TO ACCOMPLISHING THE MUST-DO’s:
· Have your student brainstorm the expenses they will incur: Tuition, Room and Board, Clothing, Entertainment, Travel, Club Dues, Sports Dues, etc.
· Have them research and guesstimate the dollars what dollars will be spent
· Break them into semester or quarter budgets so they learn as they go
· Expect push back, tears, and frustration as they put together their budget. Quietly, ask questions and guide them when they are stuck.
· Decide who owns the budgeted money in their account. Is it funded by you, by them, by a scholarship, or a little bit from all?
· Trasfer the dollars to an account that is managed by your student
· Do NOT step in and save them; they will figure it out, even if they need to get a job or loan to make it work.
· They can do it!
The life-long lessons learned
Many life-long lessons are learned when a child is responsible for the dollars they spend in college
· How to do a budget
· How to open a bank account
· How to pay your own bills
· How to apply and manage a credit card or debit card
· How to manage a budget
· Creative ways to live within your means
· How to make choices
· Ways to make money to fill the gap
· How to apply for a scholarship
And the greatest learning of all that they will receive? How to handle their finances when they get out of college and for the rest of their lives. And with any luck, maybe with very little to no debt.
What a sense of achievement and empowerment!
Budgeting and money management for college students can be a powerful lesson for the whole family. Job well done!
If you’re ready to discuss financial planning that will allow you to Fund a Life You Love®, we’d love to tell you more. Let’s talk. It’s your tomorrow.
Call us for a complimentary 1 hour review. Call 513.618.7080 or visit www.lenoxwealth.com to Fund a Life You Love.
Past Performance is not indicative of future results.
This blog is limited to the dissemination of general information pertaining to its investment advisory/management services. This is not intended to be personalized investment advice. Please contact a Lenox adviser if you would like additional information.