How to Prepare Your Graduating Kids for Their Financial Future
Graduation season is upon us! Congratulations to all of the seniors and their families celebrating this important milestone.
As you watch your child throw their cap in the air, you might be wondering what happens next. We’ve put together some tips to help you prepare your new graduate for a strong financial future.
Make sure they are fully insured under their new circumstances.
Once your child moves out, chances are they are no longer fully covered under your insurance policies. It might be time to get insurance coverage of their own, or you might be able to adjust your family’s existing plans.
- Renter’s insurance
Once your child permanently no longer lives at your residence, their personal belongings aren’t protected under your homeowners policy. There is an exception for “temporary” dorm rooms — students generally have liability and personal property coverage. Once your child moves out into an apartment or house rental, though, that protection usually disappears.
To get around this, it’s a great idea for your graduate to invest in a renters insurance policy. This affordable coverage typically costs about $20 per month. It’s a worthwhile investment covering both personal property and personal liability — if expensive items are damaged or someone is injured at your child’s residence, you won’t be left handling the costs alone.
- Auto insurance
Auto insurance goes to the title owner of the car, so your child is still covered if they bring one of your vehicles with them when they leave. Most policies will also extend coverage if your child drives a car owned by someone else with their permission.
If your child is getting a car in their own name, they’ll need a separate auto insurance policy. They might be able to get a discount if they go through the same provider that insures your family’s other vehicles.
When it comes to insuring your graduate, it’s important to understand your policies and their restrictions. A quick call to your insurance agent can confirm your child’s coverage so no one feels blindsided.
Equip them to understand and take control of their own finances.
One of the most important things you can do for your graduating senior is inspire a sense of financial responsibility. Ask them questions about their future goals, and help them think about what it will take to get there.
Open communication allows you to address many of their concerns early on before they become larger issues. Encourage your child to ask you questions about your own financial decisions and be a part of any conversations involving their insurance coverage.
Call your agent with specific questions.
Your individual situation is unique, and some questions can only be answered by an insurance industry professional. If you have concerns about keeping your child covered as they move into the next stage of life, don’t hesitate to reach out. We’ll work within your specific circumstances to find the best policies for your entire family.
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