Helping Teens Save Money For College

Helping Teens Save Money For College

Without a college degree, employment options are limited, so the majority of high school graduates will consider going on for a college education if they can afford it. College tuition costs across the nation are rising annually, making it increasingly difficult for parents to support their children’s post-secondary education. While financial aid is available at many institutions primarily through students filing the FAFSA application each year, competition is fierce, and most parents or students end up paying at least part of their education fees.

However, saving money for college can be difficult for teens, who are also learning to drive, buying a first car, and paying auto insurance as well as high school senior activity fees like prom and the senior trip. Although Mom and Dad may be helping with these costs, many teens are already working summer jobs or part-time during the school year to assist. Most families agree that college is a priority, so helping teens learn to save toward college expenses is important. Here are a few ways parents can guide their kids toward earning income for the college fund.

Fund-Matching

Few teenagers are farsighted enough to want to put away money for college. Asking them to deposit every fast food job paycheck into a savings account can reduce their motivation to work. Instead, parents can offer to match whatever amount of their earnings students choose to save toward college, whether it be twenty-five percent, fifty percent, etc. Fund-matching is a great incentive for young people as they watch their savings accounts grow quickly with the help of parents’ matching investment.

Creative Work

Instead of regular teenage jobs like lawn care or babysitting, encourage your teen to try a creative job. Landscape design is a step up from moving lawns, while tutoring is somewhat more prestigious than childcare. If your teen shows promise in a future occupation or creative enterprise, urge them to look for work in related fields. A love of books might translate into a part-time library job, while writing enjoyment could lead to writing freelance articles for young adult publications like Boys’ Life and other teen periodicals that often pay $50 to $100 per article.

Service Jobs

To help students become more community-minded while earning college money, suggest an environment-friendly service like recycling. Collecting aluminum, old tires, or even newspapers can rack up a fair amount of earnings to plump up the college fund while teaching teens the value of keeping neighborhoods clean and litter-free. Public service awareness is an important skill often taught in higher education, so this could be a helpful preparatory activity for college, as well.
Budgeting.

Teenagers should learn how to budget their earnings, no matter how meagre, before graduating high school. Teaching them the value of money and how to use credit wisely are life-long skills that can help to prepare them for college. Show them how to use a spreadsheet to chart their income and expenses, and how to plot a monthly budget and a yearly estimated forecast. As they assume more control over their finances, teens will begin to appreciate the opportunities and limits that come with income, and the role that saving for college plays in the process. Moreover, they may begin to look forward even more to college in understanding the increased earning potential a degree will give them.

High school students should gradually be given more authority over income that they generate or spend. Parents might even share some of the regular household information to illustrate broader budgeting principles. As they become accustomed to the big picture of earning, spending, and saving, teens will develop greater respect for the power of education and a future career.

10 Easy Ways to Save Money

10 Easy Ways to Save MoneyWhen you’ve stretched the monthly budget as far as it can go, chances are there are still more ways to save money and ease debit card strain. Check out the following tips and give them a try to put more money into the bank at the end of each month.

Negotiate Everything

Many things are negotiable, especially when you pay cash or promptly. From legal services to a new television or auto repairs, ask if a lower amount is acceptable or if any discounts apply.

Trade Services

Try to exchange skilled services with others that have what you need. For example, a neighbor mechanic could replace your squeaky brakes at a fraction of the cost in exchange for your sitting with the couple’s two children for an evening or two. If you’re good at record-keeping, you could prepare a friend’s taxes for filing in return for a couple of home-cooked meals, fresh or frozen.

Take a Class

Sign up for a local community college class or take one online to learn simple auto maintenance to take care of your car and avoid costly service fees. Learn cake decorating and start a side business.

Dine at Home

Cut back on eating out by planning a nice but simple dinner at home. Put on a pretty tablecloth and set the table as if for guests. Cook a tasty meal that you haven’t had for a while, and enjoy!

Drop Unneeded Services

Check your monthly utility bills to see if you are paying for unneeded services. Maybe you paid off that new cell phone but are still carrying the $7.99 insurance fee. Get rid of unused cable services. Reduce monthly trash pickup when the kids go away to college and trash dwindles by half.

Shop for Low-Cost Credit Cards.

Low-interest credit card offers are plentiful if your credit is in good standing. It’s not uncommon to find 0% interest for 12 to 18 months. Some come with a balance transfer fee, while others don’t even require that. Check with your bank and other preferred lenders to find a card that you can use without interest for an extended period of time.

Rearrange Monthly Payments

If you pay bills once a month, try to schedule your bills to come in about the same time to minimize the risk of overlooking those that arrive between pay periods. Vendors will often work with customers to change the due-by date to align with pay dates.

Downsize Your Home

If you no longer need the larger home where you currently live, sell it and move to a smaller place. The lawn will require less maintenance and machinery maintenance costs, and utilities will cost less. Use the equity recovered from the sale of your home to pay off other debts and make your monthly budget more comfortable.

Pay Bills Online

Many banks offer the convenience of paying bills online from your bank account. In addition to saving time, you’ll spend less on postage and envelopes, and can easily track payments.

Write a Debt Payoff Plan

Putting a plan in writing helps to make it more solid and realistic. Write a debt reduction plan and post it on the fridge or on your desk as a reminder. Color code your progress as an incentive to keep working at debt elimination, which will save you each month in the future!

With a few minor adjustments, you can save money each month or put a chunk in the bank towards savings. Start now and watch how quickly the savings add up!

Explained: Tax Efficient Savings for Your House Downpayment

Purchasing a home is a huge milestone in one’s life, but it can also seem daunting. A home is probably the most expensive acquisition you’ll ever make, so you want to ensure your plans are responsible enough. If you are a bit apprehensive about saving up for a down-payment, here are a few ways to get started.

For one, you must get your mortgage calculations in order. Almost everybody knows this is where many people get it wrong. You will need to know the type of interest you want. Is it going to be fixed or variable? Many factors determine this, from market conditions to the reason for purchase and how long you intend to live in the property.

According to a national property survey few years ago, more than half of first-time buyers admitted they made a deposit of more than 10% when purchasing their first house, while the average first-time buyer deposited 17%.

How much can you afford?

Before picking any home, you should determine from your coffers how much you can afford and what you are looking for in a home, you can have a look at how much you might be able to borrow with a mortgage calculator. Outline basic necessities such as the location, size, proximity to work, children’s school, stores and so on.

When it comes to affordability, calculate how much you will pay every month in mortgage rates, including other expenses such as homeowners’ association (HOA) fees, taxes, insurance, utilities, upkeep and other costs. If you are a working couple, consider a property where you can pay for all expenses with one pay cheque.

Saving for a home deposit using “Help to Buy Isa”

Banks have some vehicles which are designed to help individuals save for their first home purchase. Help to Buy Isa is one of such financial vehicles. With a Help to Buy Isa, the government will give you a £50 bonus for every £200 you save into the account, to a maximum of £12,000. This means savers can get a maximum of £3000 bonus. This is applicable for properties costing up to £450,000 in London. It is payable upon your first purchase.

One major advantage of Help to Buy Isa is, like other Isas, any interest earned in the account will be tax-free.

Save for your mortgage deposit with a savings account

Your typical savings account often pays attractive interest rates and can be an effective way to ensure you are putting money aside monthly. However, these accounts usually come with restrictions which you should be aware of. For instance, there may be restrictions on how many times you can withdraw annually to benefit from the interest.

Remember to put in money every month because you may be given less interest if you miss out on a month of savings.

The savings earned in these accounts are usually non-tax deductible as long as you abide by the terms. Over time, you will discover you have something substantial to help make a down-payment on your property.

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