“Miscellaneous” Expenses and Spending Money

When it comes to spending money parents often ask me the same question. “We know how much tuition and fees are, but how much should we budget for miscellaneous expenses and spending money?” This is one of the easiest and hardest questions I’m asked. The easy answer is “It depends.” the hard part of the answer is that you will have to sit down with your child, and help him work out a very specific and realistic budget, taking into account his lifestyle choices, cost for travel and a modest emergency fund for medical bills, prescriptions, and car repairs, if he’s bringing a car to campus.

On any given campus there may be students driving $40,000.00 Lexus SUVs and carrying $1000.00 designer handbags while there are also students who ride bikes everywhere and carry their books in the same backpack they used in high school. All these students attend the same college, same classes, and will earn the same degrees, but they all have different lifestyles.

Clearly, the Lexus driving student will have a very different lifestyle from the student who rides a bike everywhere. The “miscellaneous” expenses for the Lexus driver will likely be much higher because of her lifestyle choices. Make no mistake about it; maintaining a certain lifestyle is a choice. Even if your child is used to spending a lot of money right now, at some point he will have to learn to live within a budget, big or small. As you probably know, it is easier to learn this reality in college than it will be any time in the future.

If you haven’t had the “money and budget” discussion with your child, you need to do it during the summer before he starts college then, review the budget immediately prior to move-in day and then, re-evaluate the budget about half way through the first semester or if unforeseen financial problems arise. Your child will learn from you, through this process, that budgets should always be planned even though they will change and need adjusting.

If you have always been the person who buys food, clothing, and personal care items for your child, he may be surprised by how much these things cost. It will be virtually impossible for him to set up a realistic budget if he doesn’t know how much everyday items cost. This is when it’s helpful for your child to actually go to the store with a reasonable amount of cash to shop for everything from food, to toothpaste, to cleaning supplies.

Having your child evaluate his current needs and spending patterns in this way is the best method for him to estimate what he will spend on miscellaneous expenses while in college. If your child has become accustomed designer labels and the latest trends in electronics, you can be fairly certain that his tastes won’t change drastically, but he can make small changes that will, over time, save big money. Switching to shopping at discount stores, thrift shops and sales can save a lot, as will limiting spending and only shopping for specific items instead of shopping for recreation.