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For first-year students, one of the biggest challenges outside the classroom is learning to manage money. They’re now responsible for paying for all sorts of things on their own, from textbooks and groceries to laundry and an occasional haircut.
They’re also responsible for their university student account and making sure tuition and fees are paid on time. If you’re paying these bills, your student can add you as an authorized user, but keeping them in the loop about college costs is a great way to help them gain financial literacy and understand the investment you’re making as a family in their education.
Beyond this, parents can play a key role by helping students make a budget and keep an eye on the money going in and out of their bank account. Printable budget worksheets are easy to find online and there are many good smartphone budgeting apps.
If you didn’t do this before the start of the school year, take time now to make a list with your student of their flexible/recreational expenses (everything besides tuition, room, board, and student fees — although if they’ll contribute to these, put them in the budget as well).
Flexible expenses may include:
Next, estimate how much each item will be and agree on who’s paying for what, taking your student’s income into consideration. Their income will come from their savings, earnings from a campus job (if they will work), and possibly an allowance from you. Make it a goal for your student to maintain a certain level of savings.
The ease of buying things online and with their phones means small purchases can get out of control. Peer pressure is another factor that can cause students to overspend, so talk about how they may need to say no sometimes to an activity or purchase that a roommate or friend doesn’t think twice about. On this subject, be clear about what will happen if they don’t stay within their budget (in case they assume you’ll automatically bail them out).
Fall semester will involve some experimentation. Your student may easily stay within their budget or run short each month. Over winter break, you can look back together at the experience and help them revise their budget for spring semester based on what they learned.
A great way to balance income and spending is to get a campus job. A comprehensive NASPA study found that college students who work part-time during the school year get better grades than those who don’t, probably because they need to be more focused, organized, and conscientious about budgeting time for study.
Finding a job in the local community is an option, but on-campus positions have special advantages. The hours are usually flexible, and supervisors will accommodate your student’s schedule. Student employees meet more of their fellow students as well as more faculty members, administrators, and staff — a great network for career mentorship, professional references, and all-around support.
If Federal Work-Study is part of your student’s financial aid package, they can research and apply for available work-study positions, but there are usually plenty of campus jobs to go around for any student who wants one. Departments that hire students may include the admissions and alumni offices, recreation center, library, dining facilities, bookstore, museums and art galleries, language and computer labs, and performance spaces.
“Financial literacy can make the difference between building upon a good financial foundation from the start or learning from mistakes. It can help teens and young adults get through the ups and downs of life and provides a sense of security.”
— Lisa Paniccia, author of ABC’s for Financial Independence