Off to School You Go
A discussion with your College Freshman
It is “that” time of year. As I scroll through dozens of Facebook posts, I can watch dozens of families as they prepare to send off their children to college for the first time. There will be millions of young people headed away to college this fall, and it seems that the most important thing is to pick out a matching bedspread or time to finally meet the roommate in person. As you pack up your freshmen and send them to live away from home for the first time, here are three things that you need to discuss before packing the car:
Sounds a little crazy – right? You barely live on a budget and now I am asking you to spend a little time with your 18-year old and put a budget together! This is likely the very first time that your young person will be living on their own and life will be very different from when they were high schoolers. Discuss their steams of income – What will you contribute? Do they have a part-time job? Is there some financial aid? Talk through all of this and discuss that there are limits to these income streams and establish those limits. You will also need to discuss all the expenses involved with living on your own. Food, books, coffee trips, late night Taco Bell runs, rent, utilities – all of it. This may seem overwhelming to your new freshman, but it is better to have this discussion before they head off to school than to have a really, uncomfortable talk when they come home for Thanksgiving and they have been hit with $500 in overdraft fees!
Is it time for a credit card?
This discussion always scares me to death! The thought of handing a credit card to a college freshman who has never had to deal with one before is simply terrifying! Most parents justify this decision by stating that it is time that the student “establishes his own credit score” and then hand off a brand new shiny credit card. Credit Card companies LOVE young students. They make tons of money off young unsuspecting college students as they head away from home and have access to “easy” money by using plastic. Late fees mount up and high interest rates rack up larger and larger balances. If you give your young person a credit card, monitor it online and know what expenses are hitting the balance. Discuss the importance of paying it off monthly and not maintaining a balance. Be very, very careful with this tool and establish rigid boundaries. This could become a mistake that haunts your student well past their college graduation!
Help your student protect his identity
While I was doing a little research on for this blog, I read through a report from “Javelin Strategy and Research”. According to their recent report, young people 18-24 are the hardest hit for identity theft and it takes them an average of 132 days to find and report the breach. Young people are oblivious to this risk and they do very little to protect themselves and their valuable personal information. Simple steps like not using their social security number or giving it out unnecessarily, protecting passwords and not providing them to friends for computer or system access and not letting confidential information laying around. Again, these are things that they probably have never had to be concerned about but now their world has just gotten much bigger and others are lurking near to steal their identity at every turn. Very simple steps can be taken to protect their identity and personal information. This is a great discussion that needs to be had before they head off to college.
Obviously, this is not an “all inclusive” listing but it is a tremendous start to an authentic discussion before your young person heads away to college.
Do you feel uncomfortable having this discussion with your son or daughter? Want some help? It is what we do – every single day! We help families navigate through the “financial” piece of their lives. We are always happy to help.
If this makes sense to you but it just seems impossible or overwhelming, give us a call and schedule an appointment. We are experts at it and will be happy to offer you some basic direction and advice. It is what we do at Hollander & Associates.