Kickstart Your Freshman's Financial Education
First Semester For A Freshman is Full of Challenges
Help Your Graduate Avoid Financial Stress by Teaching Them Sound Money-Management Habits
Project Expenses: Help your child take a tally of the following: tuition, room & board, books, food, travel & entertainment. Your child may be an hour’s drive away or across the country, so don’t forget to talk about holidays, which they plan to stay on campus and which ones they will spend with family. (This is a great talk to have now without the hectic stress of the holidays). Managing everyone’s expectations is key – you may be covering most of the bill, but this process provides transparency to your student about the true cost of education.
Set a Budget: Along with setting expectations around expenses, help your student understand budgeting by delivering them a set amount of money on a regular basis. Luckily, there are apps that make sending money easy, i.e., PayPal and Venmo, but don’t forget to check out your banking app. It most likely provides the same service. Supplying your son or daughter money on an ad-hoc basis can quickly spiral out of control, parents can quickly become frustrated with out-of-control spending and your student may actually be caught lacking a much-needed resource at the exact wrong time. And don’t forget to talk to your child about ways to earn extra money like getting an on-campus job. These opportunities are guaranteed ways of saving on gas/transportation and mangers are more likely to be mindful of class schedules.
Track Spending: Once you have expenses and income accounted for, encourage your student to track their spending. Or course, this can be done many ways, pop over the App Store where there are a variety of budgeting apps and spending trackers to download, start a spreadsheet, or kick it old school with a notebook.
Give your child some time to adjust to their new financial environment (after all, they are having a ton of new experiences to acclimate to as well), plan regular FaceTime convos to talk about whether their spending is in-line with the budget. If they are on target, then great! If not, brainstorm on ways to cut spending like ordering used textbooks online, returning any books or other materials from dropped classes, and sticking to their meal plan (providing they have one). If your child has a car, periodically talk to them about how often they are using it – is it a necessity? Or would it be more cost effective to Uber places that are out of walking distance. If your student has done all these things and still comes up short of funds, consider increasing your support.
The Payoff: Responsible financial behaviors are as valuable as they are irreplaceable and are definitely not cover in psych 101. You can go ahead and pat yourself on the back now for helping your child develop solid financial habits. (Pat, pat.)
Click here to download your Freshman Budgeting Checklist.
Insight Wealth Strategies, LLC is a Registered Investment Adviser. Advisory services are only offered to clients or prospective clients where Insight Wealth Strategies, LLC and its representatives are properly licensed or exempt from licensure. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by Insight Wealth Strategies, LLC unless a client service agreement is in place.