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My Best Budget Advice as a Parent
Three times the charm. Well, I suppose that isn’t fair; all three of my kids are charming and adorable. The difference is that not all three are very good with money and frankly I blame myself a little for that. I am not one to preach, but since you asked, the best advice I would give to a parent of a new college student is to give them a budget and make them stick to it.
With my first college student, there was no real budget. She called and said she needed more and I supplied. Her requests never seemed too unreasonable. I paid her rent, credit cards, car expenses, food and so on. It all seemed so logical. Why then, as a college graduate in the real world, did she have such a tough time navigating bill paying and budgeting? Because she never had to. There was no such thing as having to stop and think if there was enough in her monthly budget for anything (a CVS run, detergent, ice cream, sushi, or even new underwear because all of hers were in the hamper). Without realizing it, her idea of paying the bills never included the word budget. She knew how to look for a good sale price, but there was no such thing as planning ahead when it came to expenses. I failed her.
Student number two was an economics and finance major and asked that we give him one lump sum each month and let him figure it out. We were apprehensive; partly for fear of giving up control, but we tried it and he did great. There were weeks that he would stay in on Saturday night because he didn’t have enough left in the monthly budget and wouldn’t get “paid” until the following day, but he refused to take a little extra even when I offered. He was determined to make it work and prove his independence. Peanut butter for dinner never killed anyone he would tell me. Truth be told, I got lucky that time around, but again, it had a lot to do with his desire to feel liberated and his knack for finances.
So, now I have my final chance to make a difference for my last college student. Her freshman year went a lot like my oldest daughter’s and I realize now I am doing her no favors. So as the new school year is about to begin, we have instituted a new budget. Included in her weekly allowance are her groceries, incidentals (like that CVS run), gas and social activities.
Her first few weeks she called me in a panic when she got to the grocery store believing that she may possibly starve, but now she is actually meal planning and thinking ahead. I literally danced when she told me, “I made sure I had money left this week because we are all going out to celebrate Madison’s birthday on Friday.” She quickly realized that it can be done and when there was a little left at the end of a few weeks, she found her way to Forever 21. Ok, I may have preferred she put it in savings, but I think she is getting the hang of it.
Recently, she got her own credit card and read carefully about the benefits it provides by accruing points. She set an alarm on her phone to remind herself to pay it every two weeks. (The two week periods are her choice. She says the shorter intervals give her more clarity as to what she has and what she owes.)At this point, I am still paying her monthly rent, but intend to add that to her allowance next year and let her get the hang of having to take responsibility for that too.
Don’t get me wrong; when she Facetimed from the mall and begged me to allow her to buy this very adorable jumpsuit using the emergency credit card I gave her, it was difficult to say no. The jumpsuit was really cute and my daughter is too, but I keep reminding myself that someday when she is able to pay all her own bills, she will thank me for teaching her to live on a budget. Well, this may be pushing it a bit; she probably won’t thank me, but I’ll know I did the right thing. And in the meantime, I now have a great idea as to what to send her for her birthday in a few weeks.
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