How to Help Your Kids not Stress About Money While They’re at School
Sending your children off to university or college and starting the next chapter of their lives is an exciting time for both you and your kids. Whether they’re in first year or a returning student, with all of the academic stress they’ll be facing, the last thing you want is for your child to worry about running out of money during the year.
The fact is, post-secondary education is expensive – from tuition to housing to books. According to a Macleans’ study, the average cost of post-secondary education in Canada is over $19,500 a year. You can help to de-stress your kids about money by teaching some simple, yet smart money-management strategies. By helping your child master budgeting while away at school, they will worry less and focus on what's important.
Consider these five tips to help your kid manage their money:
- Have an open discussion about money. Before the school year starts, set aside time to talk about money and how things will work when they are away. Break down how you will be helping them (if you are) and what sort of student loans they will have. Want some help on starting this conversation? Take your kid with you to a financial advisor, who can talk to them about how to start managing and saving money in their own student account.
- Set up a spending budget. Starting school means a lot of new expenses, especially for students who don’t live at home. The most expensive aspects of school are usually rent or residence fees, tuition and groceries. Work with your kids to figure out how much they are going to need to spend each month on these sorts of essential expenses, and then look at what money they can afford to spend on discretionary (and fun) expenses like going out with friends. One way to help them manage this budget is to pay for the essential expenses first and then let you child manage the balance or discretionary budget.
- Encourage your child to track spending. Going away to school is a great time for them to start (if they haven’t already) using mobile banking so they can stay on top of their finances. This will help them build confidence around managing their money independently.
- Look for money saving opportunities. Encourage your child to use his/her student ID to get discounts. Many food service companies offer discounted meal plans if you buy them online. Craigslist offers discounted textbooks for sale. Encourage your kids to keep their books in good repair and sell them after each term. They can use the money for next term's or next year's books.
- Be supportive without taking over. Resist the temptation to get too involved in the daily ins and outs of your kid’s spending, but check in with them periodically to see how they are managing. One great way to do this is to set up time with them after each term to talk money – is their budget working or does it need to be adjusted? Try to be calm and use this process as a teaching opportunity. Take some deep breathes if you need to talk to them about if they are spending too much on a daily latte.
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