Help Your Child Plan for College Expenses/ February 1st, 2016
For recent high-school grads, college means a lot of new changes—moving away from home, harder classes, and more freedom. But has your child considered the new financial responsibilities they will have to take on?
If your student has been relying on you for cash, it might be time to give them a financial wake-up call. Make sure that your child understands that tuition is not the only cost associated with going to college. Other items to consider in a college budget include:
- Room and board: Whether your child is living in a dorm or off-campus, housing costs will be a significant expense for any college student.
- Food: Even if campus housing provides meal plans, your student likely will order a pizza or go grab ice cream from time to time.
- Fees: Classes that require labs and equipment easily can increase college costs.
- Books and supplies: Usually students can sell their books back at the end of the semester, but the amount returned will be nowhere near what students originally paid.
- Travel: Travel expenses might include gas to and from campus, bus passes, parking, or a plane ticket home for holidays.
- Entertainment: Study break activities such as movies, concerts, and other events also will cost money.
Don't just talk about expenses, plan for them
Your child might feel panicked or overwhelmed once the realization sinks in of just how much college costs. Help your teen feel financially secure by planning a budget together. Here are some budgeting tips to give your college student:
- Assess your income: Regular paychecks, scholarships, student loans, and money from parents should be considered as a part of your child’s total income.
- Start with the most important costs: Expenses such as tuition and rent aren’t flexible and will take up the majority of your child’s monthly spending.
- Always over-estimate expenses: When unsure about costs, always over-estimate. It’s better to have extra money at the end of the month than to come up short.
- Consider a part-time job: If your child’s total income won’t cover all expenses, a part-time job can help meet monthly costs—and enhance his or her résumé.
- Use credit cards responsibly: Using a credit card to pay for expenses can be a great way to build credit if your child pays off the full bill each month. Credit unions generally offer better rates on credit cards than other institutions.
- Adjust your budget along the way: It might take a couple of months to figure out the perfect spending plan, but these adjustments are all a part of the financial learning curve.