5 Things You Should Stop Paying for When Your Kid Graduates

College is expensive, and parents often cover much of the cost. According to Sallie Mae, as of 2013, parents were funding 27 percent of college expenses from income and savings, and their average out-of-pocket spending totaled $5,727. Still, last year, 85 percent of parents believed that college was an investment toward their child’s future.

Clearly, parents are paying for much of their children’s college education, and they continue to believe that the investment will pay off. In addition to college tuition, parents might help with travel costs, housing, food, insurance, and even books. Once college is over, some college costs are eliminated, but if parents aren’t careful, their children may continue to expect them to pay for some expenses. Once your child graduates, though, you need to set limits. Here are five things you should stop paying for when your kids graduate from college — doing so will protect your own financial future and teach them financial responsibility.

1. Their rent

When your children graduate, you won’t need to pay for their on-campus housing or even their off-campus apartment as long as they move out. But your children might ask you to continue to pay for their rent until they get on their feet. While this is a completely reasonable request, you should think about it carefully. Paying for your child’s – who is actually a young adult now – apartment can be a wonderful gift if they are seriously looking for a job, but if you aren’t careful, some children will use it as a crutch to avoid getting a good job or taking personal responsibility for their bills.

Allowing your child to move home with you rent-free is another situation you might want to avoid. In 2012, 36 percent of people ages 18 to 31 were living in their parents’ home. While encouraging your son or daughter to move home briefly during a financial hardship is fine, you should still expect them to pay rent; even if they can’t find the perfect job, they should still be working.

2. Their utilities

Many on-campus apartments or rooms come with utilities included in the price. Students don’t have to worry about paying for their gas, electric, water, or even cable or home phone lines themselves because they are bundled into the room and board payments. If your child lived off-campus, perhaps you were paying those bills yourself or helping. Once your child graduates, you should stop paying any utility bills that you were paying previously, and avoid agreeing to pay any utility bills at any new rentals that they choose. Everyone has to learn to pay utilities eventually, and maintaining a monthly budget and paying regular monthly bills will teach your child a lot about being an adult.

3. Their education

Many parents pay for at least part of their children’s college education, but it shouldn’t be necessary for you to flat-out pay for your child’s graduate degree. Your child needs to learn to save money and to pay for things on his or her own, and education should be a part of this goal, as well. Encourage your child to either get a job that includes tuition remission or work for a while before going to graduate school. If you really feel you must help pay for further education, consider giving your child a loan. This will require careful planning on your part to make the loan legal (so that they must pay you back), but you can save your child money if you want to give them a low-interest (or interest-free) loan, and you can avoid giving them another free handout.

You should also just stop paying for their college in general. If you helped them with college and now they have loans to pay, make them pay those loans, and don’t do it for them or cosign for any new loans.

Money Cut in Half

4. Their personal expenses

You may have paid for your child’s cellphone during college so that you could easily reach them if necessary and so that they could check in regularly. Perhaps the idea of your child having a cellphone even made you feel safer. However, now is the time to stop paying for cellphones, clothes, laundry, restaurant bills, groceries, and so on. Many of these items are luxuries and not necessities, and if your child deems them necessary — like groceries — then you should require your child to find a way to pay for them. The more items you pay for instead of encouraging your children to save up and pay regular bills themselves, the more you are teaching them to depend on you for the foreseeable future. Again, helping out in an emergency is understandable, but there is no reason for you to support your child’s texting habit.

5. Their transportation

As much as 70 percent of college students have cars or have access to a car. Some parents feel the need to pay for their child’s car during college, either to help their child get to class, drive to an internship or job, or even to drive home for visits. Transportation is definitely important in college, and not every college town is bus friendly. However, once your child graduates, he or she should really fund his or her own car expenses.

If you gave your child a car with no strings attached, this doesn’t mean you should take the gift back. But let them pay for gas, maintenance, and insurance themselves. If you have an insurance plan that allows them to stay on your plan for a while and it is affordable, then at least require them to pay the difference while they are on the account.

There are some items that you might want to help your children with even after they graduate, like health insurance. But even if you allow your child to stay on your plan, you can still encourage them to pay their share. You will actually be doing your children a favor by teaching them financial responsibility early.

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