Sending your child off to college is a significant milestone! As you prepare your student to leave home and begin college, it’s critical to discuss money with your student. For many families, the first college bill is the moment when everything suddenly feels real. Having open discussions now can help your family come to terms with the plans ahead as your student enters a new phase of life. The first college bill can be confusing, especially because many families have never gone through this process before. The good news is that with a little preparation, you can avoid surprises and feel much more confident about the months ahead. As a financial aid advisor, here is what I advise families to do to prepare for the first college bill.
Financial Planning and Budgeting:
Discuss the financial aspects of college, including tuition, fees, room and board, and personal expenses. Help your student understand the cost of attendance and the resources available for covering these expenses, such as scholarships, loans, and savings. Teach them Budgeting 101 for First-Year College Students.
Setting Expectations for Student Contributions
Set expectations for student contributions and discuss how much money you will be able to supply for your student’s living expenses. This is directly related to your family’s overall financial plan and budget. It is crucial to discuss this now so your student knows what is expected of them. Be sure to also discuss who is responsible for repayment of any student loans that are taken during the college years.
Also look at the total amount you are planning to borrow to pay for this college, and then look at student loan calculators to see what future repayment costs might be. If you expect your student to make these payments, say so now, and discuss what impact that will have on their future budget.
How to Pay for Your College Bill
College isn’t cheap, as I’m sure you know by now. Make sure that you’re balancing financial aid options, like grants, loans, work-study, with merit scholarships, savings, or 529 plans. Once you receive that first college bill, begin to review upcoming deadlines for financial aid. If you are doing a payment plan, mark any deadlines on a calendar so you don’t miss a payment
Plan for the Unexpected
No one wants to think about what happens if things don’t go as planned, but it is always wise to have a plan for the unexpected. Talk about financial contingencies: what happens if aid changes or family finances shift? While no one should be too worried about the “what if’s” in life, it is important to know that these changes could impact your student’s financial standing at school. Alternative options, like gap years, transfers, and community colleges are very real possibilities for those what-if situations.
Work & Internship Opportunities
It is also never too early to discuss plans beyond college, including career goals and aspirations. Encourage your student to explore internship opportunities, networking events, and career development resources available through the college. Sometimes these experiences are paid, but oftentimes they aren’t. Discuss the importance of gaining practical experience and building a professional network while in school. While these opportunities might not be available to your student right away, discussing it now and looking into possibilities will allow you to prepare for those future opportunities.
Some students might have to apply for the federal work-study program, or find a job on their own. While many students can juggle work hours and class time, some students have difficulty achieving a workable balance. They might also need to work during the summer and various breaks.
Bonus Tip: Use Graduation Gifts
Graduation gifts are a thoughtful way for friends and family to celebrate your academic achievements, but they can also offer a valuable opportunity to boost your student’s financial health as they head into the next chapter of life. Whether you’ve received cash, checks, or gift cards, it’s important to have a plan for how to use these funds wisely. Consider building or replenishing your emergency fund, or having your student use the funds to put towards expenses like books or housing.
Before the first tuition payment is due, take the time to have meaningful conversations with your student about the various aspects of college life. By providing guidance, support, and encouragement, you can help your student navigate the transition to college with confidence and resilience. Having a plan in place for when that first college bill arrives and beyond will set you and your student up for success!
More about Jodi and College Financial Aid Advisors
Jodi is a FAFSA financial advisor who helps with the financial aid process to help families of college students maximize their financial aid. From completing the FAFSA and completing the CSS Profile to reviewing the SAR, responding to requests for verification, comparing financial aid offers and understanding student loan options, Jodi is a fantastic resource when it comes to student financial aid. Schedule a 15 Minute Power Chat to learn more about finding ways to pay for college.