Extension > Family > Financial Capability > Basic Financial Education > Youth and Money > Student Resources > Student Resources for College Students and Young Adults > Financially Speaking: Parents, Let's Talk College Finances
Financially Speaking: Parents, Let's Talk College Finances
Joyce Serido, Extension Specialist and Associate Professor — Department of Family Social Science
Although your student may use different tools than you do, they may think about finances in the same way. How many of these financial parenting lessons did your student learn from you?
- Keep track of your money so you know you’re not spending more than you have
- Never carry a balance on a credit card
- Save some of your money for a rainy day
- Shop around for the best price
- Before you buy it, sleep on it
- Plan ahead
Talking with your child about college, early and often, is a big factor in preparing them for the academic and social aspects of college. Many researchers and college administrators recommend that parents take this same approach when it comes to the financial aspects of college. Do you talk to your student about financial matters?
- Yes, we talk once every month or so
- Yes, we talk once or twice each year
- Yes, when something unexpected comes up
- No, I take care of the finances so my student can focus on academics
If you talk once a month or even once a year, congratulations! You are setting your student up for success. If you talk about finances only when something goes wrong or not at all, you may find that your child has developed some risky financial habits, including late or missed payments, and credit card debt. Here are some tips to get a regular conversation going.
- Ask specific what and how questions that are not overtly about money, but can lead to an open discussion about budgeting, smart shopping, and planning ahead. For example, “What kind of meals do you eat at school?” or “How do you find time to study and still see your friends?”
- Share a topical news story or Facebook post. For example, “I saw a Facebook post about a college student who used Kickstarter to pay off their student loans. How does that work?”
- Teach each other. Have your child “show you” how to download and use a mobile banking app such as mint.com while you explain the content.
If you don’t think your student listens to you, think again! Students’ perceptions of how their parents expect them to behave carry weight, especially when it comes to practicing responsible financial behaviors. How many of the following financial practices do you expect your student to do?
- Track expenses
- Spend within a budget
- Pay bills on time
- Save money
- Learn about money management via internet, seminars, books, or classes
Keep in mind that responsible financial behaviors evolve with experience — that’s why we call them financial practices. A $35 overdraft fee for a burger with friends is an opportunity to talk about the value in tracking expenses. The sting of a parking ticket or increase in student fees is an invitation to talk about a savings cushion to handle the unexpected. A rejected lease application demonstrates the impact of not paying bills on time. When your expectations don’t match the reality of your student’s behavior, consider these teachable moments.
Expecting the UnexpectedLife is filled with unexpected and unplanned expenses, and college students are not exempt. Things like parking tickets and library fines as well as phone, laptop, and car repairs are just a few of the common financial ups and downs of college life. Talking with your students about how to handle unexpected financial problems before they occur — and showing them how you plan ahead to manage financial ups and downs — may help them make better decisions when they are away from home.
Bucciol, Alessandro, & Veronesi. M. (2014). Teaching children to save: What is the best strategy for lifetime savings? Journal of Economic Psychology, 45, 1-17.
Jorgensen, B. L., & Savla, J. (2010). Financial literacy of young adults: The importance of parental socialization. Family Relations, 59(4), 465-478.
Serido, J., Shim, S., Mishra, A., & Tang, C. (2010). Family environment and its impact on college students’ well-being. Family Relations, 59, 453-464.
Financially Speaking: College Student to Self-Sufficient Adult — Five financial parenting strategies that help your student learn to make better financial choices.
Take Charge of Your Finances — Money Geek — A guide for students, from managing your money to what you’ll wish you knew in college.