How To Help Your College Grad Work Toward Financial Independence

by Judy Mollen Walters
Originally Published: 
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My own oldest will graduate from college next spring. For the last few months, my husband and I have been having many conversations with her about what will and will not happen financially when she graduates. In talking with so many other parents about what they are, and aren’t, doing to prepare their children for this exciting but overwhelming time, I put together a list of some things for parents to think about.

1. Talk Early

You should not be discussing financial independence as your graduate is donning their cap and gown. That’s far too late. You should be discussing it at least a year in advance, even more.

2. Be Specific

What are you willing to do and not do for your newly minted college graduate? Can they live in your house rent-free? For how long? Under what circumstances? How long, if at all, do you intend to pay for things like health insurance, car insurance, the phone bill? Are you footing the bill for graduate school, in part or in full? How else might your adult child plan to pay tuition and living expenses?

3. Discuss the Idea of the ‘Job Before the Job’

A friend of mine with a newly minted college graduate used that term, and I love it. Explain to your college junior or senior that they are not guaranteed a job in their chosen field upon graduation, and if that doesn’t happen, they should expect to work at a job that might have nothing to do with their interests until they find the right thing. Maybe that’s at Target, stocking shelves, maybe it’s babysitting, maybe it’s at a job with a very long commute. Whatever it is, your rules might include that the newly minted college graduate can’t use the “I’m looking for the right thing” mantra for an unlimited period of time—and if that’s your stance, how long is it okay to look for a job full-time without doing something else at the same time? Make that clear.

4. Urge Connections at College

If your college junior or senior has been diligently working toward their degree, that’s great! But what about internships, connecting with professors, going to events where they might make contacts? Nearly all jobs come from knowing someone in the field. If your soon-to-be college graduate hasn’t done this yet, urge him or her to get out of the dorm room or apartment and make this a big priority in the last year or two of school. It should be as big a priority as studying.

5. Ignore What Other Parents Are Doing for Their Kids

It’s true that some middle- and upper-middle-class families won’t insist that their newly minted graduates take any old job, or are happy to provide financial support, or not charge rent, or let their kids live at home indefinitely. But that doesn’t mean you have to follow suit. Even if you have the financial means—maybe especially if you have the financial means—it’s okay to tell your kid that you don’t intend to be like these other parents and that you have different rules or expectations. It’s not because you want them to suffer, but because you want them to grow up.

6. Let Them Go Gradually Into Financial Independence

In the earlier college years, dropping some minor financial support is a good way to get them started on the road to independence. Maybe you stop paying for movies and gas in the car, or car insurance, or repairs. Maybe they start paying for their own fender benders or transportation home. Maybe you’re not springing for spring break or you say no to the nicer apartment that comes with a $100 increase in monthly rent. Having them assume responsibility for items like these can help them get used to choosing how they want to spend their money. They may make different choices if the money is coming out of their pockets. Tell them before these things happen that you’re handing those specific financial reins over to them.

7. Understand That Your Kid Is Likely Not Lazy, But Scared of the Future

Face it, it’s overwhelming to go from the relative cozy warmth of four years being taken care of as a near-adult by Mom and Dad, who have either completely or nearly completely financially supported them through college, to living alone on a smallish salary. If you look at it from that point of view, no wonder some of our kids drag their way halfheartedly through this time of their lives. But we need to help them see that being an adult is better than being a kid—freedom to be who and what they want, and in control of their lives, is worth working through that fear. And we’re here to help them do that.

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