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Are Your Children Financially Prepared for What Comes After High School?

In 2014, Rhode Island adopted the CEE’s National Standards for Financial Literacy as Rhode Island’s first ever statewide standards. While Rhode Island has taken steps towards improving financial literacy in our schools, there is still a large disconnect between where we are and where we need to be in ensuring our children are adequately prepared for the next stage of their lives. Currently, a course in personal finance isn’t required to be offered in our high schools. So what can we as parents do to help narrow the knowledge gap?


Start as early as you can
By setting a good example and defining your own financial values, your children are more likely to adopt the same ideals. Although my parents didn’t guide me down the path of saving early, they were both exceptionally hard workers and at the age of 14, I started my first part-time job because I yearned for financial freedom. Needless to say, without having a great understanding of saving, I spent much of what I earned and had to learn from my mistakes. With my son, I hope to teach him the importance of saving early by matching his savings and credit him interest. There are many tools and creative ways to incorporate money management skills into everyday activities. The important thing is to start as early as you can to create long-lasting beneficial habits.

Help them establish a budget and track their monthly spending against the budget created
Creating a budget detailing income and expenses will help your children to visualize their overall financial condition. I was taught how to balance a checkbook but with all of the various options available such as online banking and mint.com, you might want to leverage one of these tools as they are likely to be more relevant and impactful for the next generation.  Knowing how to prioritize spending with their given income (whether it is from part-time work or an allowance) is an invaluable skill that will prepare them to become a financially responsible adult.

Get your children started on the path to good credit
As we all know, credit scores dictate the interest rates on mortgages, car and student loans. However, credit scores can influence much more than interest rates. When applying for a job or renting an apartment, your credit report is typically run so that the employer or landlord can assess how responsible you are with money. A negative report can affect the price you pay for utilities, insurances and other bills as those providers may increase rates or require a down payment. Educating your children on the importance of creating and maintaining excellent credit will save them both time and money in the future. Opening a credit card with low limits such as a gas card or even a card deemed as an “only in emergencies card” can start them on the right path.

Be specific and set expectations in regards to funding college
Specifying who will be paying for what helps define both of your roles if you choose not to fully fund their education. With the average 2016 college graduate holding $37,172 in student loan debt, it is imperative that they understand the terms of the loan and are aware of what they need to be accountable for. Would they choose an in-state college if their loan burden was reduced over attending a private college? This is not to say that one should choose the school that would lead to lower debt, but rather choose the school that should lead them to success; both while in school and after. Helping them to review all of their choices and empowering them to make informed decisions can aid in doing just that.


These are just a few of the actions we can take to financially prepare our children for adulthood. If you want to take it one step further and begin talking about investing early in a Roth IRA, budgeting after college, different types of employee benefits, healthcare and insurances, you’ll be helping to lay the groundwork for their financial independence. My next blog will cover these topics in more detail.



Megan Logee, ChFC® serves as Senior Financial Advisor at StrategicPoint Investment Advisors in Providence and East Greenwich. You can e-mail her at mlogee@strategicpoint.com.

The information contained in this post is not intended as investment, tax or legal advice. StrategicPoint Investment Advisors assumes no responsibility for any action or inaction resulting from the contents herein. Megan’s opinions and comments expressed on this site are her own and may not accurately reflect those of the firm. Third party content does not reflect the view of the firm and is not reviewed for completeness or accuracy. It is provided for ease of reference.