In the flurry of packing for the dorms, coordinating with new roomies, and shoring up emotionally, one item that can sometimes get lost in the shuffle is money management for your college freshman.
I know what you’re thinking.
Um, hello, with tuition bills, paying for mattress toppers and stocking up on premium Puffs for move in day, money is ALL I am thinking about, lady!
I get it.
I’m talking about making sure your kid can manage his or her money.
Money tips for your college freshman
These tips may help as August rolls toward us….
- Use an on-campus bank if possible (this should help reduce ATM fees)
- Bargain-hunt for those textbooks!
- Max out your meal plan.Don’t let those pre-paid dining dollars go to waste! If you have extra “swipes” left over at the end of the week and they are going to expire, use them for snacks or other items that you can store in your room. Ohio State allows those extra swipes to be used at on-campus convenience stores for non-food items as well. Check to see what your college’s policy is on unused credits or swipes
- If you pick the wrong meal plan, change it right away. It can be hard to guess which student dining plan will be best. Once you’re on campus, if you decide that your chosen meal plan isn’t right for you (too much or too little), see if you can change it. Most schools allow a switch to another tier of dining plan within the first few weeks of the semester.
- Make use of campus transportation and public transportation to avoid taking your car to campus.
This can save loads of money in parking pass fees, gas, etc.
- Stay on top of your money.
- While there are plenty of exciting things to spend your time on as a freshman (meeting new people, settling into the dorm and oh yeah, classes), don’t let your financial situation go completely unmonitored.
- With mobile technology, it has never been easier to make sure you are not overdrawing your account. And of course no one these days is ever too far from that phone, right?
Should you get a credit card for your college freshman?
I fondly remember sitting at a metal table during my own move-in day at the University of Dayton way back in 1988. That’s where I hastily applied for my very first credit card. (As a side note, it’s also where I learned how to write a check when my mother realized I had no idea but that’s another story. Besides, kids today will rarely be writing checks).
I personally was a big fan of my freshman (now sophomore) having a credit card when she went to college. Why?
- She started working on that credit score (length of time you’ve held credit is a big factor in your credit score).
- She had an emergency source of income if needed in a pinch (thankfully she never did, but still…).
- She got a jump start on being able to handle having access to credit (so far, so good).
I honestly do not see a downside of sending your child to college with a credit card in hand. Others may feel differently, of course, but in my opinion, it is just another part of their growing independence.
In short, consider making this part of your pre-college to-do list.
I had my daughter take ownership of the credit card process. I helped her identify the key areas of concern but she had to do the rest. Areas I highlighted for her included:
- Credit limit
- Interest rate
- Late fee policy
- Reputation of vendor
Should your child work during freshman year?
This is a great question and there isn’t really a perfect answer. For many families, this is a must. The student’s financial contribution through a school year job can be the final piece needed to cover expenses.
For other families, your student’s on-campus income might be used to cover the “extras”. Some students will simply not be able to manage the time crunch of employment in addition to their course load.
On the other hand, some students may relish the chance to meet new people in a job situation.
The short answer? There is no short answer--it really just depends on your child and your particular circumstances. This is definitely a great discussion to have ahead of move-in day!
College freshman budget worksheet
Do I think it is realistic that your child (or mine!) is going to carefully map out an Excel spreadsheet for budgets and methodically track each expense this year?
But, I do think it is realistic to have your college freshman spend an hour with you at the kitchen table and at least sketch out categories of spending and estimates. With debit cards, meal cards, and campus “cash” accounts, tracking money is so different than it was in our day.
Today, you just swipe away to buy your lunch, your parking, your photocopies, and your laundry. That can make it tough to budget.
Help your child get off on the right foot by looking at some common expenses and coming up with a rough idea of where the money is going to go.
For some starter ideas, see below:
- Non-meal plan covered meals and snacks
- Coffee (am I the only one with a coffee-crazy kid?)
- Uber or taxi fare
- Spending money for social outings
- Fees for extracurricular activities (fraternity dues, club fees, sports equipment, etc.)
I was surprised at how little out-of-pocket money my freshman used last year. Hope that trend continues!
Note: if you happen to have a kid who actually would track his or her expenses--lucky you! Read this great article about how to get started tracking expenses.
The money talk
Speaking on spending money, that leads me to the money talk.
You will definitely want to set out the expectations for money before your child finishes up that dorm packing list. This can help prevent misunderstandings and problems down the road.
Take some time to discuss:
- Will you (the parent) provide spending money? If so, how much?
- Will your child have to account for how she or he spends money?
- Will your child be responsible for tuition, room and board, or books? If so, to what degree?
- Does the parental contribution hinge on student grades?
- If out of state, will parents pay for flights home? How often?
- Spring break or other trips with friends? Who’s paying for those? (Hint: in my house, it’s not me 🙂 )
- If your child has a job during college, what expectations are there about contributing to college expenses?
College freshmen will make money mistakes
That’s a given, right? But hopefully with some pre-planning and open discussion, we can guide these young adults and get them started on the right path. Good luck!