This week we’re excited to welcome Susan Beacham, an expert on kids and money. I know many of you are helping your kids pack up and go off to college. I was in the same boat last year, and if you can take a few minutes away from the packing frenzy to talk about money, you’ll thank yourself later — I promise.
Heading off to college for the first time launches kids into a new way of living. Money will be an integral part of that new life and having the “money” talk before they leave will go a long way toward helping them navigate this critical resource. Now is the time to sit down and talk about a plan for spending, emergencies, health care away from home and the pros and cons of earning money while at school.
Start the money conversation with a review of the basic needs every college student confronts:
After you talk through all of the above, sit down with pencil and paper and create a budget. It does not have to be an excel spreadsheet to start, just a simple, written document that helps you and your student understand and consider the possible expenses that may arise while they are living away from home. Then, talk about reasonable estimates for those costs. Create from that estimate a suggested monthly “draw” that they can withdraw for themselves each month to cover expenses. Set up a time each month to talk about the budget to review and revise.
Kids will seek out ways to make themselves more comfortable while away from home and many of these comforts cost money. Talk about boundaries in advance and your student will avoid common traps and your own budget will not suffer the consequences of their mistakes.
About Susan: Susan Beacham is CEO of Money Savvy Generation (msgen.com) and creator of the award-winning Money Savvy Pig – a 21st century bank that teaches kids about money choice. Susan is an award-winning education entrepreneur and nationally recognized kids and money expert. She is also the author of the award-winning children’s book series, The Money Savvy Club Kids Club books, and creator of the innovative iPhone App for kids, Savings Spree. Follow Susan’s advice on her blog at susanbeacham.com