Another summer is quickly coming to an end and many families are entering back-to-school season. As your college-bound child prepares for a new school year, here are some reminders and tips to help support them in building a strong financial foundation.
- Estate Planning Documents – once your child turns 18 years old, it is important for them to have documents in place that will allow you as parent or guardian to help with health or financial matters if needed. These could include a Health Care Directive and Durable Power of Attorney.
- Create a Budget – it is never too early to start learning good money management skills that will be helpful to your child in the future. This can be especially important for college students as they prepare to manage their finances as a young adult. A budget is a good way to have financial peace of mind that all expenses are covered for this school year.
- IRA Contributions – if your child had a summer job and earned income, there may be opportunity for them to contribute to an IRA or Roth IRA for 2022. Assuming the child does not need the funds in the short- or mid-term, this is a great opportunity to start retirement saving habits.
- Build Credit – for college-aged children, a good credit score is important to create financial opportunities post-college, such as qualifying for an apartment, purchasing a vehicle, qualifying for a loan with a lower interest rate, etc. There are different strategies for building a credit score, but some options might be making payments on a student loan while in school or getting a secured credit card (where your credit limit is equal to the amount of money you deposit).
These are just a few of the things parents and students should consider as we enter the start of the school year. For a more comprehensive list for those in college, please click here to view our Planning for College checklist.
Also, if this is the first year your child is attending college and you have questions on how to utilize an education savings account, please contact your JNBA Advisory Service Team for guidance.
Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from JNBA Financial Advisors, LLC.
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