It’s almost that time of the year: when parents send their kids off to college. It’s scary, fun and life-changing for both parties. Most soon-to-be college kids will be thinking about their roommates, dorm and class schedule. Meanwhile, most parents will spend the next few weeks thinking about whether or not they’ve done enough to prepare their kids for the real world.
With so many competing priorities, it’s important to make sure you cover the basics. After helping countless families prepare and pay for college, here are my five key reminders that most families forget about when their teen moves out and on to college.
1. Set a Budget
One of the first things you need to do is help your student set a budget for what their college spending will look like. Who’s paying for what? You probably already talked about tuition, and maybe room and board, but what about the other stuff? Who’s going to be responsible for textbooks? What about other supplies? Meals out with friends? The list goes on.
For most students, this will be their first experience with budgeting, and parents need to help. Help them get started with tools like Mint or Every Dollar that make budgeting easy via a mobile app. However you do it, by helping them track and plan their spending, you’ll be setting them up for financial success in school (and hopefully fewer arguments about money).
2. Get Renters Insurance
Renters insurance, also known as personal property insurance, is a must-have for college students. In fact, some dorms and apartments even require students to have a certain amount of renters insurance as part of their lease.
If you want to help your child protect themselves from their stuff getting damaged or stolen, renters insurance is important. And this is true even the theft or damage doesn’t happen in the dorm. Leave your laptop unattended and it gets stolen? You can get it replaced using renters insurance.
The great thing about renters insurance is that it’s also very cheap, with most policies starting at just $4 to $5 per month. If you combine renters insurance with other policies, it could even be “free” because of the savings you’d get from a multipolicy discount.
3. Update Your Car Insurance
If you had a child go off to college, you probably didn’t think about the impact it would have on your car insurance. But, it’s another one of those changes you need to make to save money all around.
There are a lot of considerations when it comes to car insurance for college students. First, for you: Are you going to keep them on your policy? Will they still drive when they are at school? It might make sense to remove them from your policy (and save the money) altogether. And, second, for them: Are they going to have a car at school?
If your child will have a car at school, make sure you change the address on your policy to reflect where your child is living. If they won’t, it’s important to think about the options for them. Maybe ride-share everywhere? Or, look at on-demand rental services like Zipcar, so your student can rent a car when needed (and the insurance is taken care of).
The bottom line is, you need to make some decisions about what driving and insurance will look like for your student.
More on Getting Insurance: 15 Dumb Mistakes People Make When Buying Insurance
4. Check Your Cell Phone Plans
The cell phone. As a parent, it’s probably been the bane of your existence for the last few years. You’ve likely had at least one encounter with a shocking cell phone bill.
Well, with your child going off to college, it’s another time to look at your cell phone plans. You’ll need to decide on the best way to save money and make sure everyone has the coverage they need.
Cell phones are essential in college, so don’t skimp. But on the flip side, cell phone companies have been lowering prices dramatically over the last few years. If you haven’t shopped for a cell phone plan lately, you’d be surprised how much you can save.
5. Agree on Plans for Sending Money
Finally, you need to agree on plans for the unexpected. I know this sounds weird, but let’s face it — your child is going to miss their budget, overspend, have an unexpected trip and more.
What does it look like to send your child some money? Will you use Venmo? A shared debit card? Give them access to a credit card for emergencies? There are lots of options, so spend a few minutes and decide on what might work best for your family.
It’s also a great opportunity to re-level set expectations around the budget and spending, and what your child’s responsibilities versus yours are. Each family has a different philosophy around college spending, so make sure you’re all on the same page.
Going off to college is fun and exciting, but it’s also a time of huge change within a family. Don’t miss these details as you send your child off to school. It will end up costing you in the end.
More From Our Smart Money Squad