Experts say it’s not too late to send adult children off to college with a wealth of knowledge to keep them from falling into financial trouble.
Credit cards, student loans, and debt can be major challenges for college students. Parents can help them avoid financial ruin by having some key conversations.
First, financial experts recommend talking to them about spending and figuring out where they can make cuts to save more.
“What gets measured gets improved,” said Alok Deshpande, with Smartpath Financial. “Even if you have caviar taste, as long as you’re tracking it, you will get the information to make adjustments yourself.”
Second, experts say teach them how to invest money early.
“You can start at twenty-one even contributing to the match in your retirement plan, ten years later you’ll look and say, ‘Oh my goodness, I’ve got fifty-thousand dollars or one-hundred thousand dollars,'” said Deshpande.
Third, emphasize the importance of managing student loans and controlling their credit use.
“When the bank allows you to have credit, the lesser you use, the higher the credit score,” Deshpande said. “It looks like you’re more responsible with it.”
Finally, discuss how to negotiate. Experts say if the art of deal-making is nurtured early it can translate to future financial success.