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8 financial lessons to teach your college student

Home Blog8 financial lessons to teach your college student

Key takeaways:

  • By taking a proactive approach to discussing money management with your college student, you can set them up for success.
  • By encouraging your student to utilize discounts and resources, you can help your kid save money.
  • Help your college student budget and learn responsible financial management.

Did you send your kid to college this year? With nearly 16.9 million students in undergraduate programs, according to the National Center for Education Statistics, you’re not alone.

As they start their journey into academia, you’ve likely given them many lessons about safety, schoolwork and probably even laundry. But have you talked about finances?

As your student begins his or her first experience living on their own, here are some helpful financial tips you can give them, so they’re establishing successful financial habits from the get-go:

  • Explain how to spend only what they can afford. This may seem like a no-brainer, but your college student likely hasn’t spent without supervision before. Talk to your son or daughter about only spending what they can afford. This includes how to use a credit card wisely and the importance of not racking up expenses they can’t pay back.
  • Teach them how to budget. Your student will need to understand how much they earn before they can understand how they can spend. Help them set up a budget, so they can accurately keep track of their earnings and expenses.
  • Educate them about properly spending student loans. Your student should only spend their student loans on their tuition and critical living expenses. Drinks with friends and spring break aren’t considered “critical” – though it may seem that way to your student. Make sure they understand the concept of interest and how it’ll take them longer to pay back their loans if they misuse them now.
  • Encourage them to get a job. At first, your student may be overwhelmed with their course work, but the sooner they can start earning, the better. With a small income, you son or daughter will have the independence to start spending their well-earned money rather than relying on you every time they need some pizza money.
  • Promote scholarships. There is an array of scholarships available for students of all types. As your student chooses a major and becomes immersed within that field of study, work with them to seek out scholarship opportunities that can help them pay for their education.
  • Turn them into discount hunters. College students are privy to great discounts. From top-tier technology at minimal cost to a few dollars off at the cinema, remind your kid to use the discounts. These small sums will add up to saving them a lot of money in the long run.
  • Remind them to use the freebies. While discounts are great, free stuff is even better. College campuses are often full of incredible resources – all intended for your student’s use. Make sure your student is utilizing the library and their department’s resources to their benefit.
  • Show them how to buy used. Textbooks are often incredibly expensive and typically have very little reason for your student to buy new. Help them find used books. Many textbooks have minimal use and will serve your student well at only a fraction of the cost. Plus, as more professors adapt to today’s media landscape, many class readings can be downloaded online.

If your kids haven’t quite reached college yet, here are some money management tips you can share with your teens. By talking about money with your kids, you can help them feel empowered to manage their finances without your help.

If you’re interested in opening an account for your college student or helping them better manage their finances, visit your local MidWestOne branch.

MidWestOne Bank does not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.