16 Aug 3 Last-Minute Money Lessons to Teach Your College Freshman
The middle of August means that college move-in weeks are about to start all over the country. Many parents are breathing a sigh of relief – they did it! From college admissions to finding money to pay for school, the hardest part of the journey is over. After unpacking the dorm room, everyone heads their separate ways and things often run smoothly for about a month. Around that time, some parents may receive panicked calls from their new college student about how expensive things have become. Expensive living can lead to bad financial decisions – including using that “emergency credit card” for non-emergency situations, spending loan money for living expenses, or even dropping classes. This version of the start of freshman year doesn’t have to be the only way things happen, though. Learning money lessons is an important part of growing up – and the college experience. Even during drop off, there’s a few easy last-minute money lessons to teach your college freshmen!
Here are some last-minute money lessons:
A Budget is a Budget
Parents have to be very serious about setting a budget for their students. Unless there is a real emergency, parents should not be too quick to send money to their student. It is already a strain on the family’s budget to keep paying normal home expenses while supporting a student in college, so there is really not much wiggle room left for unanticipated expenses. Ask your student to evaluate options, look for lower cost items, or find ways to generate an additional income. It may be hard to say no to your child. But it is a life lesson better learned at an early age.
Have the Student Loan Talk Now
Too many families wait until the student graduates to talk about the volume of student loans that has accumulated, and to make decisions about repayment responsibilities. Oftentimes, students look at loans as “free money” and spend it on everyday expenses instead of judiciously applying it only to education expenses. At graduation four years down the road, everyone is shocked by the amount of money that was borrowed, and nobody is prepared to shoulder the responsibility for paying back these loans. Help your student determine how best to spend student loan money, and make sure you agree now on who will be making payments after graduation.
Keep Looking for Ways to Save Money
The last money lesson to teach college freshmen is one that will help them well beyond their school days. The only two ways to stretch a budget are to earn more money or spend less money. If your student is maxed out on academics and other commitments, then look for ways to save money. Shop for used textbooks, or see if classes have online course materials. Scrutinize living expenses to determine if it would be more cost-effective to have the student live off-campus, commute from home, or cook his/her own meals. Have your student ask around campus about college scholarships in their major or conduct research online to find scholarships for students already in college. Anything you can do to cut costs now will help in the long run.
Giving your student strong financial skills now will help them make a lifetime of smart money decisions. While it can be difficult to hold financial boundaries, it’s important that your student learns how to manage money well. We have more money lessons to teach your students before college here, too!
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