Many of us look back at our college years and revel in the expensive but exciting bosom of self discovery that left us with the best memories of our lives. Whether we learned how to stretch a box of Ramen noodles or balance our social lives with academic obligations, we learned valuable life lessons.
Now our kids are headed down the same rite of passage and while we may want them to have fun, they do need to learn some basic lessons around financial responsibility. The college years may be a time to let loose but here are some tips to help you manage your college student’s money:
Communicate openly openly about your expectations
You must have the conversation or you’ll regret it later when you get the credit card statement in the mail or a desperate call pleading for financial help. Be upfront, blunt and honest about your expectations in this area. Discuss limits around big ticket items and give some leeway if they don’t get it right the first time. The best lessons arise from trial and error.
Create a budget
This is a great opportunity to teach your newly minted college student budgeting basics such as the envelope method and zero based budgeting. Both teach financial responsibility and discipline which are key to managing money responsibly.
Set up monthly meetings to review their spending habits. Discuss what went well throughout the month (paying bills on time, saving) and what didn’t. Then create a plan to do things differently during the following month. Think of this as teaching your child how to ride a financial 2-wheeler. You’re right behind them holding the seat until they can ride solo.
Automate it and forget it
If you’re looking for a way to connect with your kid online around their finances,
Citi® Financial Tools allows you to do the following:
1. Works with your Citi and non-Citi accounts
2. Automatically include information from your Citibank and Citi Credit Card accounts
3. Shows your spending trends from all of your accounts
4. Start with 6 months of transaction history from your accounts
5. Categorize your spending into useful, customizable categories
6. Analyze your finances and provide detailed spending reports
7. Allow you to create and track financial budgets and goals
8. Provide an analysis of your net worth and investments
This took keeps the dialogue around financial responsibility open while giving them the tools to manage their finances effectively. You also have access to the account which helps you monitor spending while keeping them on track with established financial goals.
Moving on to this new stage life can be daunting at first, not to mention expensive. Still, this will be the most exciting part of their life thus far, enrich it by increasing their knowledge in an area that is increasingly important. You’ll be glad that you did.