More than perhaps any other time in your child’s life, the day they leave for college will be a day that you’ll be yearn for and dread at the same time. You’ll be filled with pride that your son or daughter has graduated from high school, and is ready to take their next big step, while at the same time, you’ll come to the bittersweet realization that they’re not a little child anymore. More than anything, you may be asking yourself, “Did I do enough to get them ready for this?”
It’s natural to feel all of these things, in varying degrees and all at the same time. As a parent, your most important job is to prepare your child to go alone into the world and not only survive, but thrive. Though they’ll face difficulties that everyone eventually has, and challenges you could never have possibly predicted, there are some critical lessons that your student should know well before they walk in for orientation to help them deal with whatever life has in store for them.
How to Balance a Checkbook
Teaching your child how to manage their own money is one of the most important, and applicable, lessons you can impart, and it’s a skill that’s severely lacking. Surveys among college students indicate that 58% are not saving anything, and 43% do not actively track their spending. If you child doesn’t start early with balancing their budget against their expenses, and knowing where their money’s going, it can spell serious financial difficulty down the road.
Educating your child doesn’t have to be difficult; in fact, it can create great opportunities to spend time with and grow closer to them before the day you wave goodbye from the driveway. Consider the following ideas:
- Set the Example – Have your child join you while you balance your own checkbook; let them see how much money you make versus how much you spend on bills, and explain your method to managing your money.
- Start Them Off Early – Give your child a reasonable allowance, however little it may be, and monitor their spending. Don’t automatically give them more if they blow it all irresponsibility; let them glean a lesson from it.
- Reward Their Success – After a pre-established time has passed, check your child’s progress on managing their allowance. If they’ve done well, treat them with a trip to their favorite restaurant or to see a movie. This will reinforce good behavior, and illustrate the value of vigilance and sacrifice when it comes to money. If they haven’t, point out their mistakes and offer them advice on how to improve.
How to Do Household Chores
Household chores are often a child’s first experience with work outside of school, and besides being necessary to make it through life, can improve their knowledge and performance in other areas as well. It will also help take some of the burden off of you as the parent. By having a solid understanding of how to take care of their home, your child will grow to respect and care for what they have, and that will extend to their own family when the time comes.
- Start Simple, Start Early – As early as your child starts walking, you can start giving your them some simple chores to do, such as putting dirty clothes in the basket, putting their toys away, or even feeding your pet. You can introduce more intricate chores as they grow older.
- Have a Discussion About What You Both Expect – Talk to your child about the specific chores that need doing, how you want them to look when complete, and which ones your child wants to do and doesn’t want to do. Give them at least one or two they don’t want to do regardless. This way, you’ll teach them the value of not only communicating and negotiating clearly, as they’ll have to do in their professional lives, but the value of doing their best on tasks they don’t enjoy doing.
- Don’t Forget to Cover Maintenance – Besides just how to do dishes or load a load a laundry machine, teach your child how to do basic maintenance on their household appliances. How to unclog a sink or toilet, how to fix a leaking faucet, and how to shut off water and power are all important tidbits to know. This way your child won’t panic if there’s a mishap in their dorm or apartment, and they can potentially save a lot of money and time from having a technician fix it for them.
How Finances Work
Perhaps more than any other area, most young people, particularly college students, don’t understand how finances, including concepts like credit, credit scores and interest rates, tie together and impact their ability to buy a car or take out a loan. You might think you’re doing your child a favor by restricting them to cash and keeping them far away from credit in high school, but in reality, you may be contributing to a stunt in your child’s growth as a young adult.
- Teach Them the Basics – Have a conversation with your child about what credit is, how credit scores affect loan options, what interest rates are and when they must be paid. If you’re worried because you’re not an expert yourself, that’s okay; schedule a trip to the bank for both you and your child to speak with a credit specialist who can explain it in detail. Your bank trip with your child also leads to the next point:
- They Need a Credit Card By the Time They Go to College – This is a terrifying prospect for many parents, as it can wreck not only their child’s financial standing, but their own is well. The reality is that sooner or later your child will need a line of credit, with a solid credit score. If they’ve never had to manage a credit account before, how do you expect they’ll do it when they’re graduated and shopping for their first apartment or a new car?
Additionally, getting a line of credit open early is essential, as it will start the solid track record they’ll need to establish a good credit history later on. With you as a co-signer setting the credit limits and getting a reasonable interest rate, your child will benefit immensely from the added responsibility.
- How Loans Work – Sooner or later, you child will need money to do what they need to do, and while you’ll do all you can to help them, the reality is that you won’t have enough for everything your child will come to need, and it may be some time before they are able to get a good job after college. Discuss how loans work, how their credit score impacts their options for interest rates, and the different types of loans available to them.
How Insurance Works
Even though most college students understand the basics of what insurance is, the majority aren’t confident that they could explain the various terms and numbers and how they’re calculated. But understanding insurance is crucial, not only because sooner or later your child will have to purchase their own, but so they can get what they need without paying too much.
- Emphasize Coverage Versus Premiums – While ‘more is better’ sounds great in theory for a lot of things, when it comes to insurance, more coverage can also result in higher costs. It’s important that your child understands how to do research to determine how much coverage they’ll need. If they drive a Toyota Rav4, that’s valued at $26K, they don’t necessarily need $100K of coverage.
- What’s Covered – Although they need to avoid paying too much, you child still needs to be willing to invest in enough coverage to protect themselves in their property. Teach them what to look for, and what questions to ask, when it comes to things like accident forgiveness, the effects of credit score on rates, and any discounts they qualify for.
They’ll Be Just Fine
Although sending your child off to college will be one of the most challenging, as well as one of the happiest events, in your life, you don’t need to fret. They will make mistakes and they will have crises, but they will also achieve great success and grow as individuals, and you’ll help them get through all of it. By starting early and emphasizing some of the key things we discussed in this article, you’ll give your child the best possible chance at having an easier, fulfilling life.