Aug. 24, 2010— -- College means more independence for many students, but it also means more financial responsibility. Before your teen goes off to college for the first time, it's important to talk about spending and budgeting.
Paying for a college education means more than just covering tuition costs. "Good Morning America" financial contributor Mellody Hobson recommends setting up a budget with your kids ahead of time, so college-bound kids know exactly where their money is going and what money is coming in.
The first step to creating a college budget is considering expenses. There are many costs to take into account, including room and board or rent, books and supplies, food and groceries, transportation, personal care (cosmetics, toiletries, prescription medications, etc.) and more. Don't forget to set aside funds for entertainment -- things like dining out, going to the movies, or big events like birthday celebrations or travel plans.
Next, figure out your child's income. This includes any income from a school job, financial aid, scholarships, student loans, and any support or monthly allowances from parents.
Parents should make it clear that income and expenses need to balance.
CLICK HERE for a printable budget worksheet for college students.
Here's are guidelines for how much students at public and private colleges spend on average each year.
Estimated Annual College Costs at a 4-Year Public University:
In-State Resident Cost
Tuition & Fees: $6,185
Room & Board: $7,404
Other Expenses: $1,848
Total Annual Cost: $17,336
Estimate Annual College Costs at a 4-Year Private University:
On-Campus Resident Cost
Tuition & Fees: $23,712
Room & Board: $8,595
Other Expenses: $1,311
Total Annual Cost: $35,374
*Provided by SayStudent.com and based on data from the 2007 College Board Trends in Higher Education