Mentees may have spent some time with you during their senior year trying to budget for the future. It's one thing to discuss it in the abstract, another to start facing the realities of managing the cost of school or living on their own.
For example, in addition to tuition, there are many smaller expenses which mentees may incur attending certificate programs. Some of these expenses are one-time, while others recur monthly (rent, phone bills, utilities, transportation) or annually (taxes). Summer is a good opportunity to preview and discuss different costs they may face, and how they can manage these expenses, and what systems they're using to keep track of it all.
If your mentee plans to live away from home, it’s time to focus on how he/she can prepare for setting up his/her new living space. Mentees who are living at home will need to make arrangements for how the day will look when they start their intended pathway: How will he/she commute each day? How will the commute affect his/her schedule? Each choice will come with financial and logistical considerations.
This is also a good time to look at one particular expense mentees may be facing for the first time: health insurance. As you and your mentee discuss expenses, be sure to talk about health insurance options. Mentees who are covered under a parent’s plan may be able to stay with their current insurance provider until they’re 26 years old, under the Affordable Care Act, in this case, mentees may choose to opt-out of their program’s health insurance plan. In either case, health insurance is an important consideration for their budget, it’s important that mentees are aware of their options for seeking medical care or counseling.
A good financial plan is a road map that shows us exactly how the choices we make today will affect our future.
Prompts for Communication:
Here are some ideas for questions or conversations starters you can use this month to discuss important and timely topics with your mentee.
- Have you been talking with your family about your pathway? How do they react? What questions have they asked you?
- What expenses have you already started to run into? What other expenses do you see coming down the road? How are you covering these expenses?
- What system are you using to keep track of your budget and expenses?
- Where are you planning to live next year? How will this affect your expenses?
- What worries do you have about paying these bills?
- What kind of health care coverage do you have now?
- Student Health Insurance: To learn more about health insurance coverage options for college students, review these options and requirements.
- The True Cost of Community College To learn more about community college expenses, including balancing school costs with other expenses, review this article from NPR.
- Costly Financial Aid Mistakes: This article addresses the importance of understanding financial aid and the costs of attending community college.
- Helping Your Student Manage Expenses in College: This article provides guidance for how you can talk to your mentee to help them understand money management and begin tackling their own finances.
- Budgeting Apps: If your mentee is ready to start actively tracking their spending and create a budget, it may be useful to review this list of helpful apps and websites for budgeting tools.
- To help anticipate smaller costs, you and your mentee may want to review sample supply lists for commuters and/or residents (if their program includes housing). This will also facilitate conversations about planning for the details of starting their program.