A child born today that goes to college will pay over $200,000 in tuition and fees for the privilege. While most students will not pay “sticker price” due to scholarships and grants, you are still talking about a ton of cash. To generate $200,000 in 18 years of investment, you would need to save $4,370 every year until your child starts college. That’s $364 per month. And that’s just for one college bound child.
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As you consider saving up money for tuition and fees, it is easy to forget about the other costs of college. Books, clothing, spending money, laundry costs, and fun money all factor into the equation. But as a parent should you be responsible for all of those living expenses?
College is suppose to be about learning, growing as an individual, building relationships, acquiring life skills, and of course having some fun. Since most college students will not pay full price for admission to a school, parents should use the extra money to help their student maximize the collegiate experience. You can give your student money in a budgeted fashion so they don’t blow it all at once while still covering their day to day needs. Consider making a deal with them where they have to keep their grades above a certain GPA to stay on your “payroll”. You’ll teach them the power of incentives and consequences if they don’t live up to their end of the bargain.
The best reason to help your college student out is to ensure they do not graduate with student loan debt hanging around their necks. Student loans can devastate a student’s first few years in the workforce and limit their opportunities. Doing whatever you can to avoid that is a good move.
Life isn’t easy nor free, and that’s a tough lesson for anyone to learn. College is your student’s first experience of “the real world”, so that lesson should begin there. If you are financially able to pay for their college tuition, that should be more than enough support for them to make it. Requiring your child to get a job on-campus (or in the real world) to fund their spending money is a part of their personal growth.
While your student might have more study time if they didn’t have to work, the reality is they probably wouldn’t spend a lot of that extra time studying. Plus, they would miss out on another key lesson of life: how to manage a limited amount of time. When you are out in the workforce you have to work, maintain your home, maintain your health, cook dinner, and a whole host of other things. You don’t have people around to do all of that for you. So help your child learn time management sooner rather than later.
There are two additional reasons to not give all of the saved money to your kid: