Talking to Kids about Heading Off to University/College Part 4 (of 4)

8. Does your child know how to keep his or her stuff safe? Having lived a pretty sheltered life, your child may not be able to image that someone would go into his wallet or her purse and steal. But campus life can be like the real world and kids have to lock up their stuff and keep their wallets close at hand if they don’t want to find that light fingers have been at work.  Time to implement passwords on computers (if they haven’t already done so to keep your prying eyes away). And it’s time to talk about not giving your password on your bank card to anyone, not even your great love or your BFF. Ditto letting anyone else use your credit card, lending out money, and offering to cover the bill because someone else “forgot his wallet.”

9. Does your kid know how important it is to be on time with bill payments? Procrastination may have been the name of the game in high school but your child may be about to learn that it doesn’t work at college or university. Neither does being late with bill payments. Even a few days late will mean fees, service charges and/or interest costs.  This may not be as big a deal if kids are living in residence where everything has already been covered. However, there may still be bills for which they are responsible, like cell phone bills and the like. Talk about how dumb it would be to ruin a brand new credit rating because a body was too disorganized to get a cell phone bill paid on time.  If your kid is sharing space with others, there will be more bills and if they aren’t paid on time, there will be more costs.

10. Does your kid know to file a tax return every year? Your child should file a tax return every year even if she doesn’t have to pay tax. Once she’s 19, she’s eligible for the annual GST/HST credit, but you can only get it if you’ve filed a return.

Some provinces provide tax credits for low-income taxpayers, which many students qualify for, so check out what’s offered in your province. Your child may be able to get a tax refund even if he never paid a penny in tax.

If a kid works in the summer and has tax withheld, he may be able to recover all or most of it by filing a return and claiming tuition fees, the education amount and the textbook tax credit. If they aren’t needed in one year, they can be carried forward or transferred to a parent or grandparent.

Tell Junior to keep all his receipts for travelling to and from university. Moving expenses are deductible if your residence is at least 40 km closer to your new workplace or school than your old residence was. But they can only be deducted against a) employment income at your new location or, b) award income such as fellowships, bursaries, scholarships and research grants when you’re moving to school. Moving expenses include transportation costs, the cost of any meals and lodging en route and up to 15 days of temporary accommodation near your new or old residence. Receipts don’t have to be filed with the return, but keep ‘em in case the Tax Man asks to see ‘em.

Part 1: cash flow management
Part 2: contracts, impulse control and credit cards.
Part 3: the cost of student loans




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