By Joanna Nesbit
When my daughter was accepted to her top college choice, she received a robust financial aid package. But even with that aid, the costs were beyond our means. So, we told our daughter that in order to attend, she would have to help by paying for books, personal expenses, and a $5,000 contribution toward tuition.
She agreed and worked as a dishwasher during senior year to build up her bank account.
College costs worry most families and, like our daughter, many teenagers will need to contribute to the bottom line. Despite this reality, most families don’t broach the topic until senior year after acceptances and financial aid packages arrive. But by that time, there is very little opportunity for the student to build a “college” fund. We had been clear with our daughter throughout high school that she would be expected to cover personal expenses and books, but until she chose to go to college out of state, we hadn’t nailed down a specific dollar amount. Saving earlier than senior year would have benefitted her.
Talking College Costs
When is the best time to start talking about college costs? And should teenagers save to help out?
To find out, I asked Ron Lieber, New York Times money columnist and author of The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart about Money.
As a start, Lieber suggests telling your child that you’re saving for college (if you’re able to) to plant the seed that college is an expectation. Middle school or younger isn’t too early to cultivate the idea, nor is it too young to ask kids to set aside some of their own money, even just $1 or $2 a week, because it reinforces the expectation they’ll go, Lieber says.
In fact, Lieber advocates that when it comes to college, every teenager should have “skin in the game” by helping to pay for some part of the cost, regardless of a family’s financial circumstance. By investing their own labor and money toward college, teens gain a sense of accomplishment and take the goal more seriously.
“Even if you’re fortunate enough to be able to write checks for everything your child might need, you can do real damage by paying for everything,” Lieber says. “Kids need to know what it means to struggle, what it means to fend for themselves financially—and we’re doing them a disservice if we don’t grant them that opportunity.”
It’s critical to begin teaching money-minded skills while kids live at home and give them practice being in charge of specified expenses.
Even if you don’t have your teen save toward college as a middle schooler (we didn’t), Lieber recommends that “every high schooler should spend at least one summer, preferably lots of summers, working for someone who’s not a relative.” Younger teens can create jobs (most real jobs require kids to be 16), whether it’s babysitting, pet care businesses, or helping someone with technology tasks like moving photos from a phone to a computer.
Ways for Teens to Help with Paying for College
Every family will determine cost expectations differently, but Lieber suggests, at a minimum, students cover personal expenses with a summer job and part-time campus job. If a student is taking a car to school, those associated costs should be on her, so she can decide if a car is worth it.
Try to be reassuring but truthful in college discussions. For anxiety-prone kids, discussing cost frankly can alleviate concerns they might have absorbed from you. Remind them you’ll work together toward an affordable option when the time comes.
Be aware: Students’ savings accounts must be reported on financial aid forms (FAFSA and CSS PROFILE). Student assets count at a higher rate (20/25 percent) than parent assets (5.64 percent) and may increase the “expected family contribution.”
Still, more savings is usually better than less. On earned income, students can earn up to $6,400 before it has a major impact on EFC, says David Levy, editor at Edvisors.com, a website devoted to helping students and their families plan and pay for college.
As a solution, consider having students pay for items such as laptops, microwaves, or other anticipated college bills before filing financial aid forms to pay down their bank accounts, Levy suggests.
I can attest to the value of a student paying her own expenses. Now a sophomore at her dream school, my daughter is a savvy textbook shopper, doesn’t rack up her credit card, and looks for inexpensive fun.
Joanna Nesbit is a freelance writer based in the Pacific Northwest. She writes frequently about parenting and her work has appeared in The Washington Post, Family Fun, Parenting, and elsewhere.