There are plenty of helpful financial tips for college freshmen, and the more your college student knows, the better. The college years are more than an opportunity to get an education and decide on a career. This is where your student will learn valuable life skills, including personal finance. Regardless of whether you’re supporting your child through his or her college career, here are seven crucial and handy financial tips for college freshmen.
1. Prepare Your Own Food
There is no short supply of financial tips for college freshmen. If your college student isn’t on a meal plan, she may spend a lot of money each week on food. There is a better way to approach this. Depending on the college, your student may be allowed to prepare food in his dorm room. Some schools allow certain cooking equipment inside rooms, such as hot plates, crock pots and microwave ovens. Ask the school about this policy and then encourage your child to purchase quick, simple meals that she can prepare herself.
2. Don’t Get a Car
What college freshman doesn’t want his or her own car? But getting a car can create unnecessary bills that your child may not be ready for. Even if you purchase a car outright, there’s the cost of insuring the car, gas, plus maintenance. Hold off buying a car, at least for now. This way, your child can concentrate on school and not worry about unnecessary expenses.
3. Start a Credit History
Some parents think it’s a bad idea to give college students a credit card, but this is an excellent way for college students to start their credit history. If they make responsible choices, they can build a solid credit score by the time they graduate, which can help them purchase a home or car. Add your child as an authorized user on your credit card. Other options: have your child apply for a secured credit card or a major student credit card.
4. Encourage Your Child to Get a Part-time Job
Understandably, you want your child to concentrate on his studies, but there is no harm in college freshmen getting a job. Working a few hours each week can put extra cash in their pockets, and help offset the cost of college expenses. Earnings can help pay for meals and perhaps books. And if your child is really savvy, he can make periodic payments toward his student loan, thus reducing how much he owes upon graduation.
5. Pay off Any Debt in Full Each Month
If your child decides to get a credit card, encourage him or her to pay off the debt in full each month. This is the only way to avoid debt and long-term financial problems. Many college students see credit cards as a steppingstone into adulthood. But if they’re not careful, spending can spiral out of control.
6. Save a Percentage of Earnings
Once your child finds a part-time job, encourage him to open a savings account and deposit 10% of his earnings into this account. Saving is probably the last thing on a college student’s mind, but the earlier your child starts saving, the better. She’ll grow a nest egg early in life, plus learn financial patience.
7. Learn How to Budget
If you don’t teach your college student how to budget, he will probably waste most of his earnings on non-essentials. A budget is the simplest way to keep him on track. And with a budget, he’ll know exactly where his money goes each month.
Nobody is born knowing how to manage finances. And sadly, some people never fully grasp these lessons. Help your student start off on the right foot and pave the way for a solid financial future. What additional financial tips can you offer incoming college freshmen?