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The average college student will graduate with about $37,000 in student loans, but few students really think about repaying that money after graduating. In fact, many new college students haven’t thought much at all about money management, much less paying off student loans at the end of their four years.

Results from a survey of 455 college students by LendEdu found that:

  • 58% indicated they are not saving anything.
  • 30% indicated their parents taught them nothing about managing money.
  • 51% received no financial education in high school.
  • 43% are not tracking their spending.

Bryan Bulmer, Coordinator for Financial Wellness at the University of Tennessee at Chattanooga, knows this all too well. He has worked with college students to help them learn financial literacy.

“There are two kinds of students I typically see in my office: students who have been taught about money management and have grasped the concepts and those who really have never been shown the impact of money or lack thereof,” says Bulmer. 

In his student presentations, Bulmer uses a giant Jenga game to show the impact of frivolous spending. For example, buying that cup of coffee each day Monday through Friday is about $100 a month. After four years, the student will have spent $5,000 on coffee alone.

“That usually gets their attention because nobody ever thinks about how much that small amount adds up to over time,” Bulmer says. “Our goal is to help them know how to be wise with their money.”

When Bulmer asks students how many of them want to move back home after college, he says not a single hand goes up. However, 60% of them do move back home. Plus, a whopping 39% of them will still be living at home into their mid to late-20s.

Studies show that annual take-home pay for the average recent college graduate is around $36,000. Bulmer breaks this down for his students this way: If you have a car, college and credit card payments, that will probably take about $1,000. That leaves you $2,000 for everything else including rent, which is usually another $1,000.  So that leaves you only $1,000 for groceries, car insurance, internet and such.

“Pretty quickly the students begin to realize that while it sounds like a lot of money, it really isn’t if you don’t learn how to manage it well,” Bulmer says.

If you want to help your college student with their money, Bulmer suggests that you:

  • Involve the student in the family finances. Let them see what it takes to keep the lights and water on, the cost of Wi-Fi and keeping the refrigerator filled with food.
  • Talk with them about how credit works. Credit card companies are notorious for stalking freshmen and older college students with deals that are too good to be true, and plenty of them fall for it only to find themselves in debt way over their heads. They often have no idea how to get out.
  • Teach them the basics of money management (e.g. banking, paying bills, safe use of debit cards, MobilePay, ID theft and such).
  • Address student loan requirements. If your student is taking out student loans, make sure they know what this means in four years. Some students are not aware that they have student loans. This should not be a surprise to them when they graduate.

Having a college degree gives many people an advantage.

According to the National Financial Educators Council, studies show college graduates will earn almost a half-million dollars more over their lifetime than someone who has not received their college degree. But, if they have no concept of personal finances and how to manage the money they are earning, it will be of no benefit to them. 

“All of our students who come into our office that are financial literate give credit to their parents for helping them be literate,” Bulmer says. “Statistical information says 34 percent of students feel financially literate and that 37 percent of parents share financial literacy skills with their students. I believe those numbers show parents are the number one provider of financial literacy skills in the lives of their children.”

Give your kids the edge they need for future success by teaching them how to manage money wisely now, regardless of their age. 

This article was originally published
in the Chattanooga Times Free Press on July 21, 2019.

“I was excited about going away to college,” said Grace Hopkins. “I have basically done everything my entire life with my sister. This will be the first time for both of us to be on our own for an extended period of time.”

As excited and prepared as Grace thought she was, she experienced some rude awakenings as a freshman.

“My parents made it a point to teach us how to do laundry, clean our rooms and manage money. I thought I was totally prepared for being on my own,” Grace said.

“It was kind of a shock when things like time management and budgeting got the best of me. I have always been good about managing my time, BUT I was with friends who were also excited about the newness of college and wanted to have fun first. They encouraged me to have fun and I let some things fall behind.”

Even though Grace budgeted her money before she went to college, she wasn’t used to having to pay for everything herself.

“It was just so tempting when your friends wanted to go grab something to eat,” Grace shared. “I figured out pretty quickly that if I kept spending money like this,I was going to be broke before we made it to midterms.”

Grace is in good company. Many college freshmen have struggled with exactly the same issues. Here are Grace’s thoughts on what she would say to her freshman self:

  • Time management is key. “As a freshman, you will want to do it all and experience as much as you can but you have to consider your responsibilities first. You don’t want to wake up at exam time and realize that you are really behind.”
  • Get involved. “I joined a couple of clubs. That was a good way to meet people outside of the people you meet at orientation. It’s a great way to get to know some upperclassmen.”
  • Be prepared for the “roommate thing.” “I had not shared a room with someone in many years so it took some getting used to,” said Grace. “We put together a roommate contract the first day about things like expectations concerning bedtime, who could be in the room and when. Even with the written agreement, there were still challenges.”
  • Beware of the little expenditures. “Everything adds up real quick.”
  • Getting enough sleep makes a huge difference. “Staying up with friends until 2 a.m. and having to get up for a 9 a.m. class did not work out real well for me.”

Many teens are anxious to transition to this new phase of life. On the outside, they act confident but on the inside they are wondering: Am I really prepared?

Encourage your teen to take Grace’s advice. Help them with strategies for balancing their newfound freedom and responsibility.

Discuss potential risks and the difficult choices they may have to make. Mistakes are inevitable, but you can prepare and empower your teen to enter into their freshman year with confidence. In the end, experience will be their best teacher.

Image from Unsplash.com

College was a good time for me, but something happened when college wasn’t the center of my life anymore: It was like I woke up and didn’t know who I was. Change is hard, and I almost lost myself trying to adjust to my new situation in some unhealthy ways.

Have you ever felt like you were losing your identity?

Author Anne-Marie Alger defines “identity” as “a group of attributes, qualities and values that define how we view ourselves, and how others may also view us.” Identity involves the labels we place on ourselves, the activities we do or even the places we work. But what happens when we let those labels take over our whole lives? We get consumed by one attribute or quality, and then we begin to lose the rest of ourselves. What happens if we are stripped of that one quality or attribute that we strongly identified ourselves with? A guest on Oprah’s podcast Food For Thought said it this way: “We lose ourselves because we are betraying ourselves in some way.” Now that’s food for thought!

For my entire life, people have viewed me as upbeat and very social. But then adulthood hit me after college graduation and I was not ready. I’ve always had people around me, but I wasn’t nearly as social the last semester of school and after graduation because “adulting” required me to be alone more.

Seeing less people and having fewer social interactions caused my moods to change and I was not the upbeat and social Akeyla that everyone knew. My friends and I had to work, so our relationships felt like they were changing in a negative way. We were too busy to connect with each other. I noticed I was changing, and my energy was so different. I felt depressed because my social life wasn’t as full as it had been. And I began to hate that my social life dictated my feelings and mood.

Recently, something hit me while I was teaching at a summer camp. I began to realize that I had let my social life become my identity. This realization helped to change my perspective and as a result, my relationships with my friends and family began to improve. Moving into adulthood, I now know can have faith and confidence in myself, my talents and my abilities.

Here are some tips to remember when you feel like you’re losing your identity:

  • The most important relationship you have is with yourself! Knowing who you are will make it easier to seek help if you begin to lose yourself.
  • Remember to invest in yourself. Alone time can be the best time!
  • You don’t have to build your life around socializing, but there are lots of ways to keep in touch with your friends. The older I get, the more I realize that people are just busy. We can’t be around each other 24/7 but we can still keep in touch.
  • Stay connected with your family. They are your biggest supporters. And guess what? They know you the best! They will probably notice any changes before you do. For example, my Nana noticed the changes in me first.
  • Change isn’t necessarily a bad thing, so get used to it. Find healthy ways to deal with it since it will be happening for the rest of your life!

If you’re a parent, you’re probably bracing yourself for the summer with your teen. There are so many things to consider: everything from what time your teenager needs to be out of the bed in the morning, how much time they should spend gaming, expectations around the house and curfew, just to name a few. And typically, the teen’s perspective is vastly different from your point of view.

Obviously, the school year can be very taxing and it’s nice to have less stress during the summer. But experts encourage you to avoid throwing structure out the window as your kids rest up for the next school year.

One way to keep your teen constructively involved is to strongly encourage them to find a summer job. While 13 or 14 may be too young for employment, they do have other options. It isn’t too young to do yard work, babysit, clean houses, or some other type of work.

Teens can learn so much from a job experience. In fact, it can help prepare them for life. Actually going through the interview process is a serious accomplishment, as many young people struggle with conversations that don’t involve texting. Learning how to look someone in the eyes and answer questions about yourself is huge.

Once they have secured a job, they typically have the chance to learn a few things, like how to:

  • Get along with a diverse team of people,
  • Manage their time,
  • Deal with authority figures other than their parents,
  • Engage with people who are rude and difficult,
  • Build relationships with kind and encouraging people,
  • Develop an understanding of a work ethic, and
  • Handle the money they earn.

One teenager accepted an 8-week job as a summer camp counselor. The job was not glamorous and many of her co-workers were challenging, so the teen frequently talked with her parents about the difficulties she was experiencing. Halfway into her commitment, she told her parents that four other camp counselors had just quit. The parents felt like the teen was looking for a way out as well.

Both parents strongly advised her not to quit, reminding her of the commitment she made. She stayed, and to this day has never forgotten the lessons she learned about how to treat people, what respect looks like and that she had it in her to overcome adversity and finish what she started. She also learned a lot about herself that summer, and while she wouldn’t want to repeat it, she would not trade those valuable lessons.

Summer jobs can teach the life lessons most parents want to instill in their children as they prepare for independent living.

Your teen may simply want to build their resume for college or prepare to learn a vocation. Either way, securing a summer job can be just the character-building experience they need to give them that extra boost. It will certainly teach them lessons that will serve them wherever life takes them.