Parents and their child standing at a kitchen island, smiling as they look at a laptop and teach their teen about money and college plans.

The Gift of Knowledge and Preparedness: Setting Young Adults Up for Life Success

The Gift of Knowledge and Preparedness: Setting Young Adults Up for Life Success

Part 1: Understanding Money

After a lot of stress about grades, activity lists, recommendations, essays, and preparing for the SAT and ACT, your teen got in! You had the discussions, chose the school, and your son or daughter is excited to embark on a journey of a lifetime: college. Whew! You’re done right? Time to breathe a sigh of relief and cue up Netflix. A break is great and well-earned, but, is your son or daughter actually prepared for what comes next?

Now, more than ever, it is crucial to make sure your young adult has the knowledge he/she actually needs. Knowledge is power is the adage, but knowledge is EVERYWHERE these days. It is easy to drown in it, not know what to look for, or get overwhelmed and give up.

After spending the last three decades talking to parents and students daily in education, business, and in life, I can confidently say I know the pain points of parents as well as teens attempting to become adults…or avoid adulting. While the series  below will not solve every issue your young adults will face, it will help you arm them with many useful tools to manage the transition and take better and more proactive care of themselves.

Create a Budget Together

Parent and teen sitting at a round table with a laptop, talking through a budget and monthly expenses together.

Money may seem simple, but think about what you actually learned about personal finance by the time you were your son or daughter’s age of 17 or 18.. Now, lessen that. Money awareness and management isn’t taught in a large portion of K–12 institutions, so if you haven’t taught them, odds are they have less than a clue about credit cards, interest, taxes, budgeting, cryptocurrency, etc.

The MOST helpful monetary piece you can help your young adult with is budgeting. Most teens are not fully independent. Many do not have jobs, and for those that do, the income is usually supplementary to what the adults in the house are managing. Young adults see a tiny sliver of what goes on with household budgeting, if anything, and, let’s face it, they are mainly focused on themselves and whether they can get a gaming system, new clothes, or that used car they’ve been eyeing.

Teaching Teens About Money: Let Them See the Real Numbers

Showing teens your own expenses, monthly income, and how you budget is essential for them to see the big picture. If you are not comfortable with showing them your household budget, you can create one together or find a template online to use. Knowing income, expenses, and how to properly budget is key not only to their own “adulting,” but also to ensuring your young adult doesn’t rack up unnecessary debt while off at school.

There are MANY budgeting templates, and if you search on Google or ask tools like ChatGPT, you can easily find them. Here is a simple one to start with—go with what you think your young adult will actually use:

Most experts on personal finance fall somewhere in the camp of 50%–70% on daily living expenses (rent, electricity, gas, groceries, etc.), around 20% to savings and debt reduction, and 10%–30% on “wants” (vacation, new earbuds, wardrobe upgrade, donating to a cause, helping a friend, etc.). You will need to examine your personal situation and that of your young adult to help them determine what ratio makes sense for them.

There are also many apps to help your young adult actively budget. Recent reviews from resources like Forbes Advisor’s Best Budgeting Apps Guide highlight options such as Monarch, Quicken Simplifi, Origin, and Rocket Money. Each has slightly different strengths, so choose one that fits your teen’s personality and your family’s comfort level.

Demystify Credit Cards and Debt

Your son or daughter will have a barrage of credit card offers at college or as a young adult in the workforce. 

How do they know if they should get a credit card, and if so, how to use it?

Your young adult probably knows very little about debt, minimum payments, the crazy interest rates of credit cards, etc. 

They also probably do not know that how they use that credit card has not only immediate and potentially far-reaching financial consequences but also very real consequences for getting loans, buying a home or a car, etc. in the future.

Teen sitting at a desk with a laptop, holding a phone and credit card while learning how to use a first credit card responsibly.

Teach your son or daughter the basics: what you use credit for and what you shouldn’t; living within their means and purchasing only what they can pay off (unless they are in an emergency that you as a parent can’t pay off); credit ratings and how they are tied to how you use your card over time (whether you pay in full, pay on time, have too many or too few credit lines, etc.).

Here is a guide to some great things for your young adult to know before he/she signs up for some random plan that showed up in the dorm mailbox.

There are also a lot of YouTube videos on the topic if your young adult will respond better to that medium. One clear, beginner-friendly option is How to Use Your First Credit Card – 5 Tips for Beginners, which walks through simple habits for using a first card wisely. Just make sure any video you choose is a general educational resource from a reputable source, not a company trying to sell its own card.

Start Saving Early

Father leaning against a wall talking with his teenage son sitting on the stairs, having a thoughtful conversation about life and money decisions.

Teach your young adult to save early! Oh, how I wish I would have understood more about this as a teen and a twenty-something person! Wealth needs to grow and branch out over time. The more you shorten the time frame from lack of saving/investing due to ignorance or living beyond your means, the more you handicap yourself.

Even if you are putting away $50 a month as a college student or recent graduate trying to make ends meet, it can make a huge impact IF you save or invest wisely.

Talk to a financial professional for advice about how and at what rate to invest your money or help your young adult invest theirs.

While savings accounts are a great habit, they are usually pretty wretched for growth prospects.

Build an Emergency Fund Together

You may be able to financially support your young adult’s emergencies, and they will have them. Let’s face it, life happens, and young adults, as we all know, make mistakes and get themselves into situations. You may think, That’s not my kid. He/she is super responsible. Well, super responsible kids can get taken advantage of, have accidents, and, even if only occasionally, make some bad choices. Your kid is not immune to life’s twists and turns.

So, it is wise to explain the practice of setting up an emergency fund, and if you are not financially stable yourself, it is critical you fully explain and get your son or daughter to start contributing to that fund every month or every paycheck AND replenishing it if they use it.

While it may seem very obvious to you as an adult, you may want to ask your son or daughter what constitutes an emergency. Make sure your young adult is on the same page as you that it is being used for a broken-down car that gets you to work, unexpected and expensive doctor/dentist bills that the university health plan or employment insurance doesn’t cover if they aren’t on your plan, etc. It should not be used for Spring Break trips to Cabo because you only live once or an apartment you really can’t afford because the view is just too great to pass up.

Finding a Money Ratio That Fits Your Family

What ratio makes sense? Well, there are general rules, but it depends on what YOUR situation is. The amount is going to vary for your college son or daughter – if you’re a Fortune 500 VP versus someone who is just making ends meet.

If you don’t have any way to bail out your kid from financial excess, mistakes, or life happening, then you need to make sure you teach saving, budgeting, and investing wisely as early as possible. It isn’t the amounts that matter, but the practices themselves that become habit. Making sure to give to your savings and your emergency fund each month before paying bills is very important.

And whatever your financial situation may be, it is never too early or unimportant to teach your kids and young adults about finances to help create independent young people who can make sound decisions for themselves as well as the family and their future families.

Parents sitting at a kitchen counter with papers, a calculator, and a laptop, working out a budget and money ratio that fits their family’s needs, savings, and wants.

Financial Literacy Resources for Teens and Parents

Want a general, safe resource with information and games? Explore FDIC Money Smart, which offers age-appropriate activities and lessons for kids, teens, and adults.

Have a kid who likes sports and video games? Try Financial Football, a free interactive game that uses football to teach money skills in a fun, competitive way.

And if you, as a parent, feel like many other parents—that you yourself don’t have the financial literacy you feel you should have—do not be embarrassed or down on yourself. Many of us never learned it and only picked things up rapid-fire as we needed to. There are all kinds of free resources, podcasts, books, videos, etc. If you’re not sure about your financial literacy, or you want your teen to check their money knowledge, take a short quiz like this: Are You Financially Smarter than a 12 Grader?

Partnering With You in Life Readiness, Not Just Academics

Money, time management, and independence are deeply connected. As tutors and academic coaches, we see every year how teens can be academically ready for college but not yet prepared for the practical realities of adult life.

At Jamie The Scholar, we believe in supporting the whole student. If your teen is getting ready for college or is already there and needs support in building healthy academic and life habits, we’re here to help.

Call Jamie The Scholar at 888-577-3224 to schedule a free consultation. Together, we can help your young adult step into their next chapter with more confidence, clarity, and practical tools.