Teaching our children to be financially responsible is an important part of the process when it comes to helping them to prepare to leave for college.
A great way to help our college students learn about managing their money is creating a budget. A budget can help them learn the important foundations of managing their money long after they graduate from college.
Here are 6 Tips to Create a Budget for Your College Student!
1. Keeping A Budget Is Important
If you are handling money, it’s always important to keep a budget. No matter your age keeping a budget helps you save money for emergencies or help you reach financial goals.
Here are some other reasons why your college student needs a budget:
- Teaches financial skills. A budget is a great way to teach your college student the important financial skills they will need after graduating from college. It helps them learn to pay their expenses on the important things first, such as rent, college tuition, food, insurance, etc. before their money can be spent on the fun things.
- Keeps track of your goals. A budget allows you to see those goals, but also tracking them to see how close you are to reaching a financial goal, such as funding for an emergency savings or to purchase a car or house.
- Learning where your money goes. It’s easy to spend our money, but with a budget, you can see how much you spend and where it is going. You can see where you are spending too much on fun activities, eating out, and more. This can help your college student learn better money habits too.
2. You Can Have Fun Still
A budget doesn’t mean you aren’t allowed to have fun. With a budget, you are teaching your college student to be guilt-free when spending their money.
For instance, you might set a budget for eating out weekly with their friends. This can be up to $50.
Your college student won’t be left wondering where their money is going and how they can afford to pay for the important things when it’s time to pay their rent or college tuition.
3. Create A Budget Together
College might be the first time your kid will be responsible for managing their own money and paying for expenses. Sit down with them and create a budget together. You can estimate some potential expenses they have this year.
You will want to create categories for each expense then break it down by month to track those expenses. A great way to keep track of their spending is by comparing and contrasting it each month as the school year progresses. Then you can make adjustments if needed.
Here are some things to include in your college student’s budget:
- College tuition
- Rent + renter’s insurance
- Car payment + car insurance
- Eating out
- Emergency savings
- Other fees or financial goals they may want to reach
4. Keeping Track
The best way your college student can keep track of their budget is with an app!
Check out Help Stick to Your Budget With These 5 Apps!
5. Set Money Boundaries
When having the conversation about setting a college budget for your child you want to make sure you talk about setting money boundaries. This will help ensure you are both aware of what you’ll pay for and what your child will pay for when they are at college.
Take it a step further by writing it down so you both can look back and remember what you agreed on.
6. Talk About Getting a Job
A great way for your college student to help contribute to having a consistent income while at college is getting a part-time job. Your child at work during their college classes, school breaks, or over the summer.
If your child is going away for their first year, it might be best to let them spend the first semester focusing on school and getting comfortable with things. Then you both can determine whether your child can handle a part-time job along with their college courses.
Make sure your child gets a job that is manageable and not working too many hours where their college performance suffers. Remember their college courses come first!