College life brings so many “firsts” and if you are getting your kid ready to head to college soon you probably have many concerns about how your child will navigate them. This is normal – sending your child off to college is a big deal and both of you will have lots of adjustments! One question on some moms’ minds is: “How can I help my child budget their money and manage their finances in college?”
Many moms wonder how their college kid will budget, especially given their newfound freedom! While I am not a financial advisor, I have talked with countless moms and college students over the years and I have learned a lot. In this blog, I share some ideas from what I have learned. For more specific financial planning and education consult with a financial expert. Teaching your child about financial literacy, how to budget, and how to manage their money can set them up for financial success in the future.
Here are 4 tips to help your child manage their finances during college:
1. Talk about finances often.
One of the first steps in helping your child budget their money in college is to have a conversation about their expenses and income. Encourage them to create a budget that includes all of their necessary expenses, such as tuition, housing, food, and transportation, as well as any discretionary spending. Perhaps you ease them into things by requiring that they take more responsibility for their own budget as they get closer to heading off to school.
2. Savings as a saving grace.
Another important step in helping your child manage their finances in college is to make sure they understand the importance of saving. Whether they are working a summer job before leaving for school or they are working during the school year itself, encourage them to set aside a portion of their income for savings. This can help them develop good financial habits and to avoid falling into debt.
3. Indebted to credit card debt.
It’s important to educate your child on the dangers of credit card debt. While credit cards can be a convenient tool for college students, it’s important for them to understand the potential consequences of carrying a high balance or making late payments. Often they learn this the hard way! Help them understand the difference between good and bad debt, and encourage them to only use credit cards for emergency expenses or when they can pay the balance off in full each month.
4. Always be their support system.
Finally, be available to your child as a resource when it comes to managing their finances in college and in any other way they may need you! Encourage them to come to you with questions and concerns, and offer advice and support as needed. Remember, this is a learning process for both of you but for your child, almost every challenge is a brand new one at this stage of life! With your help and guidance, your child can develop strong financial skills that will benefit them during their college years and beyond!