Four Money Conversations to Have With College-Bound Students

February 5, 2015

by Michelle Perry Higgins

Sending your children off to college is an exciting time. As a parent, you hope that you have equipped them with all the necessary tools to be successful. Teaching them to be financially independent is a very critical part of that equation and requires several “money talks” well before they leave for college, and then re-visiting these topics throughout the year.

Here are four talks every parent should have with their soon-to-be college student.

Money talk #1. Budgets are sexy and every student in college will need to have one to survive. Feeling poor is normal and you won’t truly understand this feeling until you are there. However, I am going to teach you how to build a budget and live on one. You have many good tools online. is one of my favorites, or you can build your own Excel spreadsheet. Create a “money coming in” line from a job, financial aid, parental allowance, or student loans. Then create categories for “money going out” like rent, utilities, water, laundry, clothing, social expenses, etc. Track every penny that comes in or out.

Money talk #2. You don’t need to spend every penny you have. There will be months when you may have a little extra cash, so save it because the next month you might run short on cash. Learn to say “no” if you can’t afford to go out to dinner or the movies. Don’t be afraid to tell your friends that you are on a budget and have to watch every penny. Remember, most students are in the same boat and will understand. After college, having a savings account with something in it is a lot more attractive than having credit-card debt, so learn to save those pennies early on.

Money talk #3. Ignore all credit-card offers, even though you might be tempted. Wait until your junior or senior year of college to get a card. By this time, you will have your budget mastered, you will have built strong financial habits, and have learned to live within your cash budget. Some parents may choose to give their child a credit card that is linked to their card for emergencies. This is prudent but must only be used only for emergencies.

Money talk #4. Don’t be late paying your bills. There is no reason your rent or utilities should be late if you are following your budget and monitoring your checking account weekly. College is the time to start building your credit. At some point you will want to rent an apartment or buy a car without your parents co-signing, and a strong credit score will give you that independence.