| Hi Taylor:
My son graduates from high school in a few months and I'm trying
to figure out the right advice to give. Going out on your own is never
easy, and it's especially hard these days! Any words of wisdom? -
Hi Liz: It's been an unbelievably trying time for young adults.
Fortunately, a lot of the advice I would have offered a year ago still
holds true when it comes to college students and finances.
take out big loans without a plan. The student loan crisis
rages on, working its way toward $2 trillion in national debt.
The problem isn't just that young people are taking out loans;
the issue is that they don't have any strategy for repayment.
We can't really place the blame on 18-year olds trying to get
a degree, so it's our job to help them look ahead and set goals.
Explain how the interest works, how long it will take to pay back
a certain amount of debt, and how those monthly payments can make
it really hard to focus on anything else until the balance is
paid down. Also, everyone should think long and hard about taking
on student debt for remote classes. Nothing wrong with postponing
school for a year and saving some cash while we wait for life
to get back to normal.
2. Sniff out free money. It's always worth looking for grants
and scholarships, and not just the traditional ones that pay for
four-year schools. If your son can get the tuition covered for
a certificate or associate's degree, he might get a jump start
on his career and still be able to attend a university part-time.
A little outside-the-box thinking goes a long way when it comes
to saving money and preparing oneself to transition into the professional
world. Take it from a guy who got most of his education through
free audiobooks from the library!
3. Start saving. Just throwing a few dollars in the bank every
week will have your son outpacing the rest of his generation when
it comes to saving for the future. Student loans and changing
industries have most people waiting until their 30s (at the earliest)
to start saving, so this is the easiest and best thing a young
person can do. If he wants to be more active, he can buy some
quality stocks and watch his money go to work. It's hard to think
about the future when you're that young, but a little financial
savvy now could have your son retiring before he turns 40.
| If nothing
else, make sure you explain how debilitating debt can be. With his
whole life ahead of him, taking on excessive loans and running up
credit cards can put everything on pause. If he understands that,
I'm sure he'll get the rest of the pieces to fall into place. Thanks
for the question!
Information presented is for educational purposes only and is not
an offer or solicitation for the sale or purchase of any specific
securities, investments, or investment strategies. Investments involve
risk and, unless otherwise stated, are not guaranteed. Be sure to
first consult with a qualified financial adviser and/or tax professional
before implementing any strategy discussed herein. To submit a question
to be answered in this column, please send it via email to Question@GoFarWithKovar.com,
or via USPS to Taylor Kovar, 415 S 1st St, Suite 300, Lufkin, TX 75901.