- I saved a college fund for my daughter but decided not to give it to her.
- Instead, I’m having her apply for student loans so that she can learn financial independence.
- I hope this financial responsibility will help her become a better adult.
College was one of the biggest challenges when parenting my daughter.
High school was easy because we were a small, tight-knit family that followed a schedule.
My wife and I would do school drop-off every morning and then go to work. In the evenings, we would all meet back at home and talk about the highs and lows of our days. Weekends were rather adventurous. We would go out to explore new places, or our daughter would spend time with her friends. Everything was rather predictable.
Unpredictability set in just when my daughter was about to go to college. There were so many decisions to be made, and we were not all in agreement with them. My daughter wanted one thing; my wife and I wanted another, and it was a constant cycle of trying to figure things out.
Paying for college was our biggest hurdle to face as a family.
We saved for my daughter’s college but then had second thoughts
One thing we were prepared for was the financial aspect of higher education. We knew the transition would be expensive, so we had set aside a college fund years ago to ensure we would all be comfortable.
However, I started reflecting on my life and the hardships that I had to go through as I grew up. For me, going to school was a privilege because I came from a middle-class family where my parents tried their best to give us everything we needed.
As one of six siblings, things were never easy. My parents provided my education by constantly applying for loans. This gave me a burning desire to work harder and reach my goals because there was no fallback plan.
Along the way, I learned significant money lessons that I’ve carried into adulthood — lessons I wish my children would equally learn.
Of course, the goal is always to provide a better life for your children so they don’t have to know the difficult life experiences you went through but sometimes we have to make decisions they will be grateful for later.
Therefore, despite having a college fund, I encouraged my daughter to apply for student loans.
I hope she can learn financial responsibility
Apart from emphasizing savings and keeping piggy banks when she was younger, I never had real-life opportunities to teach my daughter about money management. Her journey to college was the best place to start. After all, she would be independent in a couple of years.
By encouraging her to apply for student loans, I was hoping to teach her to make important financial decisions in the long run and understand debt management.
As education is important, paying back the student loans will be equally important to her because the loans provide long-term educational value. Learning how to budget and manage debt repayments is a critical life skill for anyone.
To ensure our daughter was on board with the idea, my wife and I had an open discussion with her regarding this huge financial step. We also set realistic expectations on the loan repayment terms and exchanged ideas on how to manage finances post-graduation.
We agreed that she will look for jobs during semester breaks and will be able to save a little of what she will earn in a “loan payment” account that she will eventually have.
She was surprised and had to process it for a couple of days. But after many discussions, she understood and now does the loan applications herself — now that she’s in her second year of college.
Owning a personal bank account and a loan repayment account will help her split the money she gets into two and make do with what she can.
Now, she’ll be better prepared for adulthood
Considering that we can afford to pay for college, this may seem like an extreme measure, but it’s one that we feel is needed. My biggest fear is raising kids who will not be financially independent when the time comes.
By taking these little steps, we hope our daughter will understand the importance of managing her finances properly, even if we won’t be there to guide her. Life is unpredictable, and you don’t want your kids to feel incapable of handling the challenges that may come their way.
What she doesn’t know is that her college fund will remain untouched for her to receive in the future and that we will be a safety net if things get tough. But we didn’t offer that upfront because we wanted to help her find her way and give her a start in this cold world.
