Categories: Budgeting
When your first child heads off to college, you’re likely well aware that a degree is going to be an expensive (but worthwhile) investment. When the financial aid office puts together aid packages, they use the cost of attendance to determine how much aid you need. Cost of attendance includes direct costs like tuition, fees, room and board, that will appear on the bill, and indirect costs that don’t appear on the bill. Those indirect costs can include things like textbooks, supplies, dorm room essentials, groceries and other miscellaneous expenses. We’re sharing some ideas of expenses to consider as part of a realistic college budget that goes beyond just tuition.
Fixed Expenses for a College Student
- Car payment/insurance/parking – Will your student have a car on campus? Does the college charge for parking? Make sure you factor that into your budget for indirect costs, as well as any car payment and insurance.
- Cell phone/data plan – How long will your child stay on the family plan? Would you like them to reimburse you for their costs each month? Whichever route you go, don’t forget cell phone expenses in the budget.
- Health costs – While it’s likely your student will still be under your insurance throughout college, what expenses will they need to take on when it comes to their health? Calculate any prescriptions, regular doctor visits they might need, or other over-the-counter items they use regularly.
Flexible Expenses for a College Student
- Textbooks – Textbooks can be pretty expensive at the college bookstore, but there are cheaper options available at used bookstores and online. Include an estimate for this cost in your student’s budget.
- School supplies – Freshmen may need to buy a laptop for the first time, plus other items like a new backpack, notebooks, a calculator, etc.
- Dorm essentials – Many parents will help their child with the cost of setting up their dorm room. This could include things like a mini fridge and microwave, bedding, cleaning supplies, and some pots and pans for cooking. You may want to encourage your student to save some of their graduation money to go towards these costs.
- Groceries – It’s true, your kid isn’t going to eat every single meal in the dining halls. Make sure they’ve budgeted to buy some groceries each month, like cereal and study snacks.
- Laundry – Most college students rely on pay laundry services, and although the amount might be minimal compared to other expenses, it’s important to consider them in your overall budget.
- Travel and transportation – Depending on where your child is going to school, their travel and transportation costs could vary widely. Will you need to buy airline, train or bus tickets for each school break? If they drive home, what will the gas and tolls cost? Finally, even if you don’t need to consider travel costs, it’s likely they’ll want to have some options for transportation while at school, so UberTM, LyftTM or other transportation expenses should be estimated.
Once you have a realistic understanding of how much all these indirect costs may be, sit down and have an honest conversation with your child. How much of these do you expect them to cover? Will you help them with it at all? Make sure you’re on the same page before move-in day rolls around.
A checking account is a great tool for helping your college student manage their finances.
Sign up for an online checking account – a new way to bank!