For many, children are off to college taking on what life has in store for them. Entering the real world can be challenging.
As students graduate high school and enter an extremely important time in their life, they begin to face decisions that will affect them financially for years to come.
“Where should I go to college?” What should I major in?” “Do I take out student loans?”
As a parent, what should your role be in helping your kids make these decisions?
Setting the bar
What does your child expect from you as he transitions into college? Come up with a game plan for how you are going to help your child through school. Whatever the plan may be, it is crucial to effectively communicate it with your student.
Financial independence does not mean that you cannot help financially. As a recent graduate, there were many times where I was in desperate need of money and my parents came swooping in at the perfect time. It is more important that a student understand his parents’ expectations for how that money is expected to be managed, which can provide great learning opportunities.
Building a budget together could be a great starting point. Discuss what has worked in your life and provide input when needed. Having a student set financial goals, such as paying down student loan debt, can be extremely beneficial.
Guidance, not helicoptering, is key.
Be there when the road gets bumpy
As a recent college graduate, I faced tough decisions daily and there were many times where I didn’t know the right answer. It’s difficult going from a life that depends on parents, siblings and others to a life in college where you are thrown into the world of independence.
College can be a time where students find their true passion and it can also be a time of growth where they can become equipped to take on the world.
After stumbling into the financial planning field, I quickly understood the importance of making smart financial decisions and realized how far behind I was. Where was my money going each month? How do I begin planning for my financial future? These were some questions that I began to process.
Change is hard. Take the time to communicate the plan that you laid out with your child and discuss the goals that have been set. Check to see if progress has been made and encourage your child to keep at it.
Help them look toward the future
Looking toward the future can be difficult for a college student. I know it was for me.
As parents, it could be very helpful to discuss what the future might look like. By allowing your college student to come up with future goals — whether it’s buying a house or starting a family — will allow him to gain motivation and get excited about life after college.
The dream job that you imagine for your child might be different than the dream job that he has in his mind. Be supportive and help him reach his goals.
Many universities offer services to help students understand their finances and get one step ahead of the game. These services could potentially help them through those difficult decisions that they might face. If students can take advantage of these services, they will find themselves financially stress free through college and equipped to take on post-graduation life.
As you are adjusting to life with a child in college, try to remember that financial independence does not just happen overnight. Be supportive, be encouraging and provide guidance as your child embarks on a lifetime journey of tough decisions.
Nolan Keim is an active member of the Financial Planning Association of Greater Kansas City. He currently serves as a client service associate for Mariner Wealth Advisers in Overland Park.