You can justifiably be proud of your college graduate, be they your child, grandchild or even a close family friend. Your graduate has overcome all the problems associated with attending college, including the many social distractions, finance challenges and academics. Given that almost half the students who start college never finish, this is no small feat and deserves a proper celebration.
The next big challenge for your graduate involves several difficult life transitions, including:
Role Transition to Wage Earner
The Financial Transition to Independent Living
Overcoming the Financial Literacy Deficit
You can do quite a bit to help your new graduate along, and it involves a lot more than the traditional money in a card given at the celebration.
The role transition to wage earner can be quite overwhelming for a graduate. Since five years of age, the young adult’s primary role in life has been that of a student. Now, they are expected to be an adult with all the answers to life’s many problems. The transition from a role they successfully navigated (student) to a new role they know very little about (wage earner) will create significant stress and can be quite overwhelming. The Adulthood Center For Research (University of Massachusetts) reports the stress of moving from college to an independent life can create a temporary, diagnosable mental health challenge in 32% of new college graduates.
Three actions you can take to help a graduate’s role transition:
Explain to your graduate the incredible power of goal setting in their personal life—not just work—to obtain the best outcomes! Whether the goal is finding a job, reaching financial milestones or doing a certain number of job interviews per month, goal setting is essential for success.
Help the graduate with their job search by volunteering to do specific tasks, research, or cheerleading—nothing that involves directing the search or forcing the graduate to pursue certain job opportunities. The graduate is an adult now.
Temper your expectations to those you would have of a grown adult you happen to share your home with. You do, however, have a right to basic courtesies, such as the graduate being quiet when they come home late at night so they don’t wake up the household. However, try to avoid treating your college graduate like they are still in high school.
In the financial transition to independent living, the graduate is faced with a very limited income and likely an onslaught of bills—including student loans—which come at them like a freight train. According to the Transition to Adulthood Center for Research, a full 71% of graduates experience severe financial anxiety from this financial evolution.
Three actions you can take to help with the graduate’s financial transition:
Offer to help the graduate create a budget—a task that is fraught with emotional challenges that even trouble older adults. Explain to the graduate that with good budgeting, their current financial state won’t last forever and their efforts now will save them major stress in the future.
If the graduate is particularly stressed, consider a one-time gift to help them jump-start an emergency fund.
If the graduate is being financially supported by you, and does not seem to be making progress in their financial transition to adulthood, consider beginning a gradually decreasing scale of financial support. It is important, however, to inquire as to why they are not making progress. Don’t assume you know because of your observations, as some of the symptoms of depression and anxiety can appear to be “laziness” to the casual observer.
Your graduate will have to transition to navigating the financial world on their own. Unfortunately, most graduates aren’t particularly well equipped to do this and must overcome a significant financial literacy deficit. The National Financial Educators Council (NFEC) states the average graduate, between the ages of 19 and 24, only scores a 71% percent on financial literacy tests. This barely-passing score will not serve them well financially.
Three actions you can take to help your graduate overcome their financial literacy deficit:
Explain to your graduate that financial learning is a lifelong process and that you are still learning yourself. Buy your graduate financial books or suggest other financial educational sources.
Give your graduate financial facts related to financial courses of action. Research the problem and find statistics and accepted financial practices that support a particular course of action.
Openly discuss various financial topics often with your graduate. Just be careful not to be judgmental about their choices.
Your graduate could likely use (and would appreciate) some assistance. Helping them transition to their new role can help you both transition to a new and fulfilling adult relationship.
~ Larry Faulkner