This month our focus has been on financial education, which is something that it is never too early to begin teaching. While it may not seem that general financial education for children would have much of an impact on student loans it very well can.
We all know the saying “time flies,” so it’s important to teach financial habits to kids from a young age because before you know it they will be making decisions about college. We love being able to help students borrow the least amount of money as possible for college. Here are some ways to begin teaching your children about money so that they have the education and potentially some savings for when they go off to college.
Preschool:
Save coins in a clear jar, as this may spark curiosity.
Use cash when you take your kids/grandkids to the store and have them put the change in the coin jar when you get home
When the jar is full have your kids help you count the coins to become familiar with different coin values
Elementary School:
Continue with the above coin method but considering adding an end goal such as using the saved coins to go out to the movies.
Create chores or household duties that your kid/grand kid can help with and get paid for.
When you go to the store and they want a candy bar or toys, have them use some of their money to purchase their wants. They don’t have to pay for the entire thing but if they are putting some money towards it they will begin to understand that things cost money.
If they don’t want to spend all of their money that’s great! You can start a savings account for them (when they are teenagers this savings can help cover college expenses).
Junior High:
Have your kids/grandkids get summer jobs and miscellaneous jobs such as babysitting, and pet-sitting to make their own money. Trust me, this will quickly teach them about spending, as it’s no fun to spend your own, hard earned money.
If a savings account hasn’t already been opened, now would be a great time to open a savings account and/or a checking account.
This is a great time to focus on community service, grades and extracurricular activities as these will greatly enhance your transcripts and scholarship applications.
Begin thinking about potential careers and explore the costs of various colleges. It’s still early to know exactly what you want to go to school for, but this is your opportunity to take classes and explore different potential careers.
It’s also a great time to shadow professionals in careers that are of interest to you. Don’t be afraid to ask lots of questions!
High School:
Continue focusing on community service, grades, and extracurricular activities because this is the time when scholarships are applied for.
Continue to shadow professionals in various careers, even if it may not be something that was ever of interest to your student.
Visit college campuses and ask what scholarships and grants are available.
Be sure to compare both private and public schools, as sometimes private schools offer larger scholarships, thus reducing their cost comparison.
Apply to various colleges and universities, as you can use their scholarship and grant offerings to negotiate with your top choices.
Don’t be afraid to ask for more grants and scholarships.
Apply for any and all scholarships. I can’t emphasize this one enough. You won’t get all of them that you apply for, but it’s worth the extra time spent.
Many times the essays that are required for college applications also work for scholarship applications with only a few modifications.
Many people apply for the largest scholarships and don’t bother with the small ones. From personal experience the small scholarships add up and with fewer applicants your probability of getting these ones are greater.
When shopping for dorm essentials don’t go overboard. Save as much money as you can
College:
Continue applying for scholarships and grants. Many people think that once they are in college they can’t get more scholarships, but there are still some available scholarships.
Be conscientious about your spending habits. If you have a job during college try to pay the interest on your student loans, particularly if you won’t be going for loan forgiveness. It might even help you on your taxes, as interest paid may be tax deductible.
When you complete your annual FAFSA and they give you your estimated loan payment remember that they are only calculating that for the single year. They don’t take into consideration your existing loans or your future loans.
These are just a handful of ways to educate your kids or grand kids about money. If you had a money experience growing up try sharing that with them as well!