It’s so easy to Amazon Prime your way into debt, especially as a new adult who may be living away from home for the first time, managing a credit card for the first time or spending to self-medicate to feel better about homesickness or a breakup.
Stop Priming, start planning. Make sure your freshman chooses wisely how to spend that hard-earned cash — namely, by teaching them to understand the difference between wants and needs.
Sit down with your Rowan student, ideally before they start their college career, and talk to them candidly about money. Grab a piece of paper — let’s do it old school, Mom and Dad — and create two columns: wants and needs.
Whether you’re funding your freshman’s living situation or they’re paying their own way, these conversations are important. At the top of the page, make a note of how much money your student has to spend each month, from savings, a current job or a gift from you. On the left side of the paper, write in big ol’ capital letters: NEEDS. On the right, WANTS.
You might want more paper…
That daily habit of a venti white chocolate mocha at Starbucks is over $30 a week. Everyone’s finances are different, so for your family this might be fine … or it might not be. Maybe your student’s budget is $50 per week and they’re perfectly happy to live in white chocolate mocha bliss and cut back in other ways (or maybe they think that you’re a softie and if they blow their budget on Starbucks you’ll bail them out).
Until it’s in black and white on that piece of paper and talked about with you, wants/needs and expectations may not truly be clear to your freshman.
Have the candid conversation. Are you expecting your student to contribute to their cell phone bill? Car insurance? Their own Amazon purchases on your account? Will you cover the cost of gas for your commuter? E-ZPass for your student who lives 2+ hours away? Let there be no surprises.
Now, back to NEEDS. Food. Shelter. Contact lenses and allergy pills. A laptop. Gas to go back-and-forth to school. Make your list that’s specific to your student.
WANTS. Emphasize to your freshman that a lot of new students bond over entertainment and food. There WILL be late night Chinese takeout and pizza delivery in your student’s future. Now, if they’re blowing all their cash on Starbucks, they’re going to have to say, “Nah, I’m cool” when everyone is walking to Wawa for slushies at 11 p.m. (because college).
On top of the regular WANTS in the wants column — coffeehouse drinks, movies, dorm decorations — emphasize to your student that they should set aside a part of their WANTS budget for those spontaneous, unplanned adventures with friends. Who wouldn’t want to jump in the car on a warm September Saturday with new friends and head down the shore?
Now back to the boring NEEDS. Outline your expectations. Will you cover emergencies, Mom and Dad? What exactly counts as an emergency? Do you expect that your student sets aside a part of their NEEDS budget every month for unexpected things, like replacing the car’s windshield wipers? New shoes for a job interview?
Again, nothing will be clear unless you make it clear, with your student, and have these candid discussions about WANTS and NEEDS. Mom and Dad, you do NOT want to be surprised with an Amazon Prime bill from your eager student who hit up Pinterest for dorm decorating ideas and expects you to foot the bill.
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Brandi Blanton, financial literacy expert