We have written before about the importance of parents having their son or daughter to have some skin in the game when it comes to paying for college. When it comes to thinking of ways to have skin in the game, we urge parents to think beyond student loans. To the teenager brain, loan payments several years down the road do not necessarily provide the motivation to study that we parents would wish. Does that mean your student does not have to contribute to the costs of college?
There are many ways to have skin in the game and not all of them are financial. Here are some suggestions:
Working - It might be using earnings from a summer job to fund spending money during the freshman year. It might be taking a part-time (10-15 hours) job working on or around campus. Financially this might not seem like a big money maker, and it's not, but the benefits of having your kids be responsible to an employer go beyond the paycheck.
Textbooks - The typical budget for textbooks is $1,200 - $1,500 per year but it's crazy to spend that sort of money these days. There are less expensive options such as book rentals, used books, and book buybacks are everywhere. Have your son or daughter take on this responsibility on analyzing the less expensive options as soon as they register for classes.
CLEP and Placement Tests - At many schools, students can take College Level Examination Program (CLEP) test to place out of courses. These exams are significantly less expensive than a college course. One additional benefit to the extra credit is an increased probability of on-time graduation. It is a challenge at many colleges to get out in four years.
Making a budget - College spending money is a common last minute topic but with a little planning you can save plenty and have a better experience. Check out our student budget worksheet (link to it on our website). Focus on the components, not the total. Talk about what expenses you will pay and those the student will cover.
We recommend you revisit the budget after two months to see how it's working.
Family Educational Rights and Privacy Act release - Get this release from your student at college so you can communicate directly with the school. Colleges will not talk to you about your student's record, grades, anything (except perhaps the invoice) unless you have a form your child. It might seem unlikely that you will need these forms, but the thing about them is that when you need them, it's hard to get them. It is a good idea to get a copy of your student's grades for a variety of reasons, and the colleges will not volunteer this information. For example a student could drop out of school without your knowledge while still getting thousands of dollars in tuition.