Teaching Your Almost-College Student to Budget
So, your teen has graduated and is heading to college in the fall. They have their classes picked out, their dorm room decorations and enough spending money to survive the first semester. The question is, will there be money left over by November?
Here are five ways to teach your teen about budgeting and keep them (and you) out of debt.
- Give a crash course. If you haven’t yet, explain to your teen how checks and credit and debit cards work as well as the importance of savings and checking accounts in budgeting. You may also want to discuss the importance of comparing costs and how to shop smart.
- Decide on Expenses. Before your child leaves for college, make sure they know exactly what expenses they will have to pay. For example, you will pay tuition and room and board, and they will be responsible for their books and any extra expenditure. This will help them plan accordingly and avoid surprises later.
- Set up a savings and checking account. If they do not already have one, help them set up a separate savings and checking account that they will manage. Such accounts help them to keep better track of their money and to see where it is going. Check out prepaid cards, such as Campus Dough for help managing money.
- Let them help. Have them help you with the household budget for the months before they leave. Seeing how much things cost in the “real world” will be an eye opener for them and make them a little more aware how just how far their money will go.
- Make them responsible. Put one bill in their name a few months before they leave. This will teach them first hand how to budget while you are still there to oversee and make sure that they don’t get themselves into trouble.
You might also keep a watchful eye on their accounts for the first semester just to make sure. You may find that you need to walk before you can run by giving your child a monthly stipend rather than depositing a full semester’s worth of funding at a time.
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