Financial conversations are tough to have with your children — especially when it concerns paying for college. It’s important to remember that college is really an investment in them, but you should be prepared to candidly discuss your thoughts and expectations about who is paying for what. As a parent, be clear about any stipulations placed on funding your child's education. Below is a list of the considerations that may need to be addressed.
Limits Based on Major
Are there limitations on the types of schools or programs for which you are willing to pay? Will you pay to go to art school or only if he goes to a university for engineering, business or a science?
Do you require a particular GPA be maintained and/or a set number of classes to be taken per enrollment period? Will you pay if they drop to half time or get “Cs” for grades? Is study abroad, an exchange program, or a gap year a part of the financial plan?
Are there expectations that your child will work part-time, full-time or not at all while they are enrolled? Will you assume that your child will work over the summer for spending money? Will they need to earn money in the summer to pay for travel expenses to and from college over breaks?
Are loans expected to be your child’s primary responsibility or are you financing a portion of the educational costs? Will you co-sign on a student private loan, but expect them to repay after college?
Are you paying for all medical and dental costs through your existing insurance, or will they be using the college plan? Will your student need to schedule annual visits to the doctor over break to ensure that the expense is covered through your health insurance?
Help the Conversation with Numbers
It’s always good to start a kitchen table conversation with some numbers. North Shore Bank’s College Cost Estimator
breaks down college expenses whether you’re looking at next year or eighteen years from now. Plus, it will help you understand financing costs for all your eligible options based on your family's unique financial situation. Invest five minutes of your time so you can get a real assessment of monthly costs while your child is in school as well as after graduation.
Remember, paying for college is an investment. So make sure that you are comfortable discussing your thoughts and expectations about who is responsible for what. Setting clear expectations will not only help your entire family get on the same page, but also teach your child about budgeting and future financial obligations.