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Collegiate Coddling: Preparing Your Child for Financial Independence as a College Student

If you’ve read anything on this website, you’ve learned that parents have a significant impact on their child’s thoughts, beliefs and behaviors surrounding money. Even emerging adults report how their parents’ actions are still impacting them. A recent study[1] by Dr. Joyce Serido and other researchers focused on how emerging adults retrospectively viewed how they were parented and how it affects their financial habits and personal wellbeing in their first year of college.

father and son smiling at eachother

Being a college student, I can personally relate to the following quote from this study: “You don’t even realize all the silly stuff you need [as a college student]—like toilet paper, toothpaste, … milk. … I mean, at home it was just there.” In retrospect, living at home has its perks, and the things you need tend to already be there. Yet, the stress of adapting to independent living and handling your finances as a college student can lead to personal growth. Parents can play a proactive role in preparing their children for this shift, aiming to enhance their child’s wellbeing and reduce their stress. I’ll present three factors that influence college children’s success; the first is somewhat outside of parents’ control, but the other two are things you can improve on today!

Parental Social Status

Parental social status refers to the level of parental wealth. As parental social status decreased, there was an increase in financial stress and psychological distress in college-age children. As parental social status increased, the child’s feeling of subjective wellbeing also increased. However, lower parental social status was also related to more budgeting—a healthy financial habit—in college-aged children. This may be because as they became more financially stressed, these students used budgeting as a tool to lessen psychological distress, leading to higher subjective wellbeing.

Perceived Parental Financial Communication

Do you remember your parents talking to you about money? If you don’t, chances are that you struggle with money now, because there are many benefits to parental financial communication. The more that college children reported that their parents talked to them about money as they were growing up, there was lower financial stress, reduced psychological distress, improved subjective wellbeing, more budgeting, and increased savings.

Perceived Parental Financial Expectations

man sitting a writing in a notepad

Interestingly, how students perceived the financial expectations set for them by their parents also had an effect on their financial behaviors and psychological wellbeing. College students who perceived their parents as having higher financial expectations for them budgeted more, which is more financially stressful but overall led to less psychological distress and higher subjective wellbeing. In addition, these students were more proactive in saving their money, and proactive saving is associated with less financial and psychological distress.


Here are some takeaways you can utilize in your parenting:

Talk about Finances: The quality of parent‐child communication regarding financial topics proved to be the most potent predictor of children’s financial, psychological, and personal well‐being. So, it’s safe to say that you ought to talk about finances with your children. College-aged students that felt comfortable going to their parents for financial advice had reduced financial and psychological distress. So, even if you don’t think your kids are listening, have the conversation anyway; it may benefit them when they’re away from you.

Raise Your Expectations: Parents’ expectations had a significant influence on their children’s well‐being. Part of the reason for this is because perceived parent financial expectations strongly correlated with proactive financial coping behaviors in their child. Having a higher social status as a parent was associated with delayed financial independence in children, so even if you have the means to support your child, ensure you have high expectations of their own financial capabilities. The way parents expect their children to behave influences their behavior, even in emerging adulthood.


[1] Serido, J., Shim, S., Mishra, A., & Tang, C. (2010). Financial parenting, financial coping behaviors, and well‐being of emerging adults. Family Relations, 59(4), 453-464.