Getting a Grip on College Living Expenses

Tuition Costs are Just the Beginning

Date: June 24, 2010

Contact: Paul Golden 303-224-3514, [email protected]

DENVER—For the past 18 years you’ve clothed your child, fed your child, and put a roof over his or her head. Your son or daughter is college-bound this fall—or perhaps returning as a sophomore. Summer is a good time to talk with your child about the ins and outs of managing housing, food and other living expenses while away at college. And if your child is a returning student, review the past year.

"We’ve learned what not to do,” says Hope Torrents, whose daughter, Elisabet, will be a sophomore at the University of Wisconsin in the fall. “We didn’t really have a budget plan for her."

Torrents, of Coral Gables, Fla., soon will sit down with Elisabet to review her sophomore living costs. Together, they’ll create a budget for Elisabet.

Dorm vs. Off-Campus Housing

On-campus and off-campus housing costs can vary quite a bit. Most schools require freshmen to live on campus. The upside: Your child’s living expenses will be fairly fixed. The dorm room will be furnished, equipped with Internet and cable hook-ups, and located near dining halls.

If your child wants to live off campus, he or she should compare the costs versus living on campus. Off campus means your child must pay for rent, groceries, furniture and utilities. Renters insurance is a good idea—and an additional expense. If you are looking for off-campus housing, the Apartment Features Worksheet will help you determine which apartment is best for you.

Outfitting the Dorm Room or Apartment

Your child needs to outfit where he or she will live. Advise your teen to do some research. It’s a good idea to contact his or her future roommate to discuss what each will bring. Both want to avoid arriving at college toting a mini fridge. For dorm living, your son or daughter should check with his or her school to see what’s in the room. Some colleges supply microwaves and mini fridges. Beyond that, your child should plan to bring clothing, desk materials, linens, toiletries, decorations and small personal items.

If your child opts to decorate or buy appliances or apartment furniture, he or she should do so armed with a shopping list and a budget. Big-box retailers push back-to-school deals that can encourage binge spending. Thrift stores, flea markets and online sites such as Craigslist are a cheaper alternative. So is your home.

"It’s pretty easy to get caught up in the whims of coordinated dorm room furniture and accessories at the department store. But you can run up a lot of expense on what almost certainly will become throw-away or leave-behind items,” says Paul Golden, spokesperson for the National Endowment for Financial Education. "The best bet is to choose comfort and efficiency over pricey and disposable."

Neil Reiter of Brooklin, Maine, consolidated two houses into one after moving from New York City four years ago to what had been the family’s vacation home. Many items are in storage in Maine, including a microwave and casual chairs. Their son, Max, will bring those next fall to his University of Pennsylvania dorm.

"There’s going to be little or no investment necessary to furnish his room,” says Reiter.

Co-signing a Lease

You’ll inherit a financial stake in your son or daughter’s apartment if the landlord requires you to co-sign the lease. Avoid having to pick up a roommate’s tab if he or she fails to pay rent.

“Make sure when you sign it’s just for your own child and not anyone else,” says Torrents, who co-signed their daughter’s lease for next fall in Madison, Wis.

Her husband, a lawyer, read the lease with a “fine-tooth comb.”

Meal Plans and Swipe Cards

Many colleges allow students to choose a meal plan. Your child should choose carefully. An unlimited plan may tempt him or her to eat his or her money’s worth, even when it’s too much. A limited plan may leave your child hungry and buying additional snacks and meals.

Aurita Apodaca of Westminster, Colo., and her husband recently sat down with their daughter, Sonny, to go over next fall’s meals at the University of Northern Colorado. Their cost-cutting solution: Sonny will buy lunch and dinner via the meal plan. The parents will buy breakfast items at Costco and mail them to Sonny.

"She’ll keep breakfast foods and snacks in her dorm room,” says Apodaca.

A college-supplied magnetic swipe card is an easy way to pay for meals. The cards also can be used at other campus sites including bookstores or snack bars. Some off-campus merchants such as convenience stores also may accept them. Check if your teen’s card is like a debit card pre-loaded with a certain sum. That can prevent binge spending on clothing, snacks, etc. But be sure to find out what happens when there is no money left on the card and make certain your child will not need the card for something critical, such as medical care. Otherwise, you’ll want to monitor your child’s spending, perhaps by having bills sent to you.

Four Wheels…Two Wheels…or Two Feet

If your child wants to bring a car, ask if he or she really needs one. How much would your child use it for trips home or elsewhere? Most campuses are designed for students to walk, bike or ride the bus. If your son or daughter wants a car, you both need to consider the costs. There’s parking, gas, maintenance and insurance. Plus, don’t forget possible parking and traffic tickets.

"As a parent, you can ensure your teen maintains the same comforts of living at home while he or she is away at college by helping him or her plan for their upcoming living situation,” says Golden. “Together, you can decide what works for all of you and avoid any financial surprises come the end of the school year.”

Graduation 2010: Cover the Basics Before Your Child Leaves the Nest
Parents provide the most influence on their children’s financial knowledge, attitudes and behaviors. Our graduation series provides information and topics weekly to help you start a conversation with your kids. For more information and to download NEFE’s 40 Money Management Tips Every College Student Should Know, visit: here.

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Contacts

  • Paul Golden

    Media Relations Director

    Direct: 303-224-3514
    Cell: 303-918-3620
    [email protected]

  • Patricia (Pat) Seaman

    Senior Director of Marketing and Communications

    Direct: 303-224-3538
    [email protected]