Postcollege Life Requires Financial Transition

Checklist for Parents: The Postcollege Financial Transition

Making the financial transition from college student to full-time worker can be challenging for college graduates and their parents alike. Parents: Use this checklist to guide the process.

Step No. 1: Insure graduates' health

  • Learn exactly when graduates' coverage ends under parents' policies; rules vary.
  • Check for separate deadlines for health, dental, and vision insurance.
  • Schedule health, dental, or vision appointments before coverage ends.
  • If the graduate has a new job, find out when coverage begins.
  • Shop for low-cost, high-deductible "temporary" major medical policies to cover the gap between the end of the parents' coverage and the start of the graduate's work-related coverage.
  • If you buy a high-deductible policy, check for special features such as prescription discounts or coverage for annual physicals.

Step No. 2: Transfer ongoing expenses

  • Create a list of expenses that students must plan to pay, such as vehicle insurance, renters insurance, utilities, gasoline, and groceries.
  • Decide whether you'll help with expenses during the period between graduation and the arrival of the graduate's first paycheck.
  • If you plan to contribute, specify whether the money is a gift or a loan.
  • Pick a specific bill or expense to pay, rather than simply writing a check.
  • Consider giving students gift cards for gas or groceries to help set limits for your contribution.
  • Decide whether you'll co-sign for a car loan or sign as the co-tenant for a housing lease, if the student asks for your help.

Step No. 3: Find a place to live

  • Check when the lease ends for college housing and find someone to sublet if needed.
  • Look at the cost of rental housing, including first and last month's rent, if required, as well as any security deposit.
  • If the student decides to return to the family home, decide when you'll start charging room and board and consider setting a deadline for the student to move out.
  • Consider a plan to help live-at-home graduates save to cover the cost of establishing rental housing or a down payment on a house. One option is charging monthly room and board, but then saving half of that amount on the student's behalf.

Step No. 4: Share financial skills

  • Encourage grads to create a budget to help stretch their money to cover weekly, monthly, quarterly, and annual expenses.
  • Explain how to build a strong credit score—such as paying bills on time— to gain access to better options and costs for housing, insurance, cell phones—even to jobs.
  • Help graduates understand the value of growing money over time by establishing retirement savings and other long-term accounts.
  • Explain the benefits of being a credit union member: lower interest rates on loans, lower fees, access to financial guidance, and exceptional member service.

If your graduate needs help establishing a budget, Harvard Credit Union is eager to help. You can call us today at 617-495-4460, Email Us, or stop by any of our locations.

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