As a family member of a student entering college, there is a lot to get done before they dance off to their classes and new friends. Many of these conversations won’t be the only conversations you will have about finances. These “money talks” should become a normal occurrence, but hopefully these prompts are a good place to start.
Who will be responsible for repaying student loans?
66% of students at public universities and 68% of students at private institutions graduate with some form of student loan debt. Having a plan for how to tackle these loans before your student begins their college journey will benefit you in the long term. Will all of the loans be the responsibility of the student once they begin repayment? Will multiple people be paying these loans back along with the student?
Students and families may have different ideas about these loans, so it is best to make it abundantly clear what the plan is before anyone signs on the dotted line.
Will your student get a job?
Many campuses are filled to the brim with students excited to get one of their first “real jobs”. Some jobs are on campus and some are close by within the community. On-campus jobs are known to be a little more flexible than off-campus jobs, but students may be able to work more hours if they find a job in a small shop or office outside of their university.
Jobs also come with more responsibility placed on the student. These additional responsibilities could possibly put too much pressure on students to perform not only in the classroom, but also in their part-time position. A student needs ample time to study, make friends, and relax so a job may not be best for everyone.
One of our HUECU employees who has had two children graduate from college said, “Jobs teach good time management skills and financial basics. I am glad my children were able to responsibly work during college.”
Who will pay for on campus clubs and student activities?
Most students have a goal of getting involved on campus, but some of these extracurriculars come with a price not included in the tuition bill. If your students are thinking about joining a social club, an athletic team, or other campus groups they may need to pay dues or fees. Will students pay these with their earnings from a job or maybe money saved from summer babysitting?
Does your student have an independent bank account? If not, is now the time to get one?
You may have your student on your bank account now to keep up with their money or let it grow in a savings account. This has worked for your family and it may continue to be the route that your family will take.
As they take this first step towards adulthood though, it may be time for them to have their own account so they can learn to manage their own money. They also may get a debit card for the first time. It is essential they have access to these accounts so they can keep up with their balances. Most students qualify for bank accounts with financial institutions across the country, so find one that offers benefits to your student through a university affiliation or personal finance education. The Harvard University Credit Union’s College Life Account features loads of great perks and services for Harvard College students.
These are just a few questions to get you started talking about good financial practices for your student. We hope this helps make the transition to college just a little bit smoother!