Post secondary education is a precious gift and is meant to prepare our children to have a wonderful, successful and wealth building career along the road of life. However, one of the things we have been hearing a lot about lately is financial literacy and how ill prepared our children are to handle the financial side of their careers.

My whole adult life has been about helping people manage their money and today I write and speak around the world about helping people to get their personal and financial lives in order while they can. Today, I would like to talk to you about helping to set your children up for financial success before they even get their first job out of university or college.

Whether they are a new student or returning for another year, here are Five Financial Basics to help you and your child set themselves up financially as well as personally to have a successful and rewarding school year and to be prepared when that first big pay check comes their way in life after they have completed their academics.

• Have a money conversation with your child before they have to start balancing their books.

You are the role model for your children when it comes to money and if you do not think they are watching your relationship with money, think again. Draw up a monthly budget with them and ask them what strategies they think they can put in place to be able to live within their means. Ask them how they think they will be able to cope the next month if they go over budget the month before.

• Talk to them about credit cards that are often handed out like candy on University campuses.

Now do not get me wrong here! I am not saying that credit cards are bad but more than one is a recipe for disaster.  Some kids are using one card to pay off the other and hardly making the minimum monthly payment let alone eating.  If you want your child to have a credit card for things like buying books on campus and emergencies, then consider putting a low maximum limit on the card (e.g. $500). You can monitor the usage even though you are not always with them. 

Another option is a pre-paid credit card that works very similar to a gift card and does not affect an individual’s credit ratings. Explain to them how they can easily rack up debt and tear down their credit rating, which could take them years to repay and repair.

• Protect their identity.

Often students are more interested in their studies and their social life than they are on keeping an eye on their personal information. However, in today’s day and age it is imperative that they remain vigilant.

If someone manages to steal their social insurance or social security number, other identifying information or their credit card information this too can have a devastating effect on their credit rating. Often students do not stay on top of these things so it could potentially take awhile for them to notice.

Here are some tips to take precautions to prevent fraud

Sign up for credit monitoring

There are a number of free credit monitoring services that will monitor the information on their credit reports and keep track of their credit score. It can also alert them to fraudulent activity so they can stop thieves from doing more harm.

Be vigilant of their online accounts

If you have set them up with a checking or credit card account check them regularly to be on top of unauthorized transactions. If you spot anything report it immediately to help mitigate responsibility at your end.

Don’t give out information easily

Make your children aware of the importance of protecting their information at all times. They should not be letting others know their pin numbers or passwords no matter how trustworthy their friend might be. When they are using a debit or credit card in public be aware of their surroundings and who is watching. While all of this might sound somewhat paranoid the world has changed for all of us in this regard so talking to your children about this is extremely important especially if they are moving away from home to attend school.

• Tax tips for students and parents

Many students think they do not need to file a tax return because according to them they are dirt poor.  Well, tax agencies wear a different set of glasses than they do and they are not rose colored. A number of students work in restaurants during the school year and receive tips and it is important to make sure they understand that they have to keep track of these tips. Here is a handy guide to help you with student tax questions.

Parents: you also need to be aware of what affects you from a tax standpoint while your child is in school. The Canada Revenue Agency website and the IRS website contain information for both students and parents around a number of important topics.

• Insurance coverage for personal items

There is so much going on when your child is returning to school that insurance on personal belonging is often lost in the chaos.

Statistics show that there are nearly 4,000 fires each year in university residence halls and over 12,000 thefts.  So taking into account these statistics, it should be easy to see the need for insurance to protect your child’s property.

The bill can add up quickly when you factor in a laptop computer, cell phones, clothing, etc.

Going off to university or college for the first time or returning for another year should be an exciting time for your son or daughter.  Therefore, setting them up for success will allow them to start their year on a high note and begin the next chapter of their lives in control of their financial future.

To learn more tips and strategies to help you take control of your family’s personal and financial future please visit the Shop to order my best-selling book, WITH THE [STROKE] OF A PEN: Claim Your Life and Planning Binder. Follow me on Facebook, LinkedIn, Instagram or Twitter.