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College Countdown Part II: Preparing for the First Semester

The day your child gets accepted into the college of their choice is a time to celebrate! But then comes the realization that they will soon be moving out and possibly far from home. The feelings that parents can experience range from “Oh no, I don’t know what I’ll do without them” to “Oh yay, I finally get my life back.”

Many changes come about when a child starts college. Whether they are moving into a dorm or continuing to live at home, it is a time of transition for them and for you. Here are some things that you can expect that first semester.


What to Expect Financially

College costs can be one of the biggest expenditures in your child’s life. When you are assisting your teen financially with their college years, it is important to be prepared for what lies ahead.

It’s also important to talk to your teen about handling money. Maybe you have been good about instructing them on the birds and bees of finances. If you haven’t, now is the time to start educating them about a student bank account, credit card, and budgeting.


Additional Costs

Regardless of whether you consider yourself financially prepared or not, you may find college to be costlier than you initially thought. The costs listed on the college’s website include tuition, housing, meal plans, and other school fees, but don’t include other necessary expenses. Some other college expenditures include:

● Books and supplies

● Laptops and other electronic devices

● Food and entertainment

● Clothes and dorm room necessities like bedding, decor, toiletries

● Fraternity/sorority or student club fees

● Transportation on campus

● Trips to come home

Being informed will help you from being caught unaware of additional costs. You can plan ahead for these expenses but know that there will always be a few unexpected ones, too.


Grants, Loans, and Scholarships

Money is money, right? Not exactly. It’s important to know the difference between grants, loans, and scholarships.

A quick breakdown of these types of college funding:

  1. Grants. This type of aid is given to a student because of financial need. Grants are a free gift and do not need to be paid back. They come from a variety of sources, including federal and state governments, schools, and various non-profit organizations. A student can qualify for these by completing the FAFSA or CSS Profile.

  2. Loans. There are two types of financial assistance that come in the form of loans. This financial aid is basically borrowed money that will need to be paid back to the lender.

  3. Federal student loans. These are funded by the federal government and usually have fairly low interest rates. Repayment plans are income-based and start six months to one year after graduation. To qualify, students need to complete a FAFSA form.

  4. Private loans. These loans are offered by private lenders. While these loans can fill the gap between what the federal student loan provides and the cost of college, interest rates are usually higher.

  5. Scholarships. Another form of free money, scholarships are merit-based. They do not need to be repaid. Scholarships are offered by private companies, schools, and various organizations. Many require an essay, transcript, and letters of recommendation. Students will be competing against other applicants for the scholarship money.

FAFSA

You will want to help your child fill out their FAFSA, or Free Application for Federal Student Aid. Walking through it together takes about an hour. Many people who have higher incomes don’t fill out the FAFSA because they assume they won’t qualify for aid, but that is a mistake.


Completing the FAFSA is the way to see if your child is eligible for grants, aids, and different types of loans. Federal subsidized and unsubsidized loans are very affordable options, especially compared to private loans, and a FAFSA is needed to apply for them.


Don’t be surprised by how nosey the FAFSA form can be. Not only will you need to upload your Social Security number and most recent federal income tax returns, but you will also need to provide bank statements and investment records.


Help Your Teen Budget

A big lesson that kids will learn that first semester is how to really handle money. With them living more independently, they will be faced with new choices and decisions. Some of these include:

  1. Books. Who knew that a textbook could cost hundreds of dollars? The average annual cost of textbooks is $1,200. Depending on the major, it could be even more. Solutions?

  2. Buy used. The campus bookstore, as well as online sellers like Amazon and Chegg, offer used books

  3. Rent. Many booksellers offer textbooks for rent at a lower cost. You return the book at the end of the semester.

  4. Purchase older editions. Depending on the subject, you might be able to get away with using an older edition. Some professors are okay with this, especially if the newer edition is not that different.

  5. Meal Plans. It might be tempting to buy the premium meal plan for your teen. But, save some money by considering a few factors, like:

  6. Class and sleep schedule. If your teen has early morning classes, travels for a sports team, or spends the majority of their day away from campus, they may not utilize a full meal plan.

  7. Dietary restrictions. Many campus cafeterias offer dairy-free and gluten-free options, but several don’t. If your child has dietary restrictions, it is worth checking out if a meal plan is even worth it.

  8. Rollover policies. Some meal plans will rollover to the next semester or next academic year if they aren’t used. Others simply expire. It may make more sense to start with a smaller meal plan and add if needed.

  9. Credit Cards. Your teen should be prepared to be inundated with offers from credit card companies. They should avoid signing up for these credit cards. What to do instead?

  10. Secured credit card. You can set them up with a secured credit card that gives the flexibility of a credit card but has a built-in safety net of a prepaid deposit limit. Your teen still can build credit history using these wisely.

  11. Debit card. While this does not build credit history, debit cards still offer easy access to money. It can pull from your or your child’s checking account.


Final Thoughts

You can successfully weather your teen’s first semester away from home. By being prepared, both financially and emotionally, you will ease the transition ahead for you and your child.


Written by Matthew Delaney