Financial expert Rachel Langlois tells us how to financially prepare for college.
College acceptance letters are currently being received and reality is hitting—how are we going to pay for this?
Oftentimes, teens have no concept of the expenses associated with school so it’s important to start having these conversations as soon as possible. Here are a few things you can do to help prepare now:
- Create a Budget
- Help them calculate how much they’ll need in order to pay for tuition, books, rent and living expenses. Break expenses down into the amount they’ll need to save before school starts and what’ll they’ll need to earn per month to make ends meet.
- If you are planning to assist in some way, create clear expectations on what you will help with and what you expect in return.
- Create understanding of what are wants and needs so that they do not go into debt financing wants during their college years. Teach them frugality and prudence and give them guidance on how to live within their means.
- Teach Banking Basics
- Does your child have a savings and checking account? Make sure they understand home banking and how they can monitor their account.
- Set up a savings accounts for specific college expenses, such as one for tuition and another for living expenses to help alleviate temptation to spend funds that need to be saved.
- Credit Card: if you feel your child is ready, you may consider helping them get a low-limit Visa to help them start earning credit and to teach them greater responsibility.
- Financing Options
- Scholarships and grants are a great option as they are in essence “free money.” Typically they take some effort to apply for but the rewards are worth it. Many scholarship funds are not receiving enough applicants willing to put forth the effort to apply—don’t think you have no chance at being chosen, you may surprise yourself. Apply for Cyprus’ scholarship at https://cypruscu.com/library/files/scholarship.pdf.
- Part-time jobs are great for high school students to start earning and saving now. It is also wise to start applying now for full-time summer employment as the competition for those positions grows the closer to summer it gets. Students can also start looking for on-campus employment for Fall semester.
- Loans and always an option, but the least preferred as they require payments of interest and create a greater burden upon graduation. Help your children prepare now to graduate as debt-free as possible.
Cyprus Credit Union offers many helpful tools on their website here.