College Planning with Xiomara Menendez
College Planning with Xiomara Menendez
On this episode of Financially Naked: Stories from The Financial Gym, our host is Emily Egan, PR Manager. She is joined by Xiomara Menendez, Level 2 Trainer, to talk about college planning for her daughter.
Podcast Notes
Xiomara started with The Financial Gym as a client and, at the time, her daughter was 16. Xiomara didn’t have a plan in place to pay for her daughter’s college, but she knew she wanted to pay for it.
Xiomara’s trainer reminded her to first put on her own oxygen mask and take care of herself, so she could help her daughter later.
Eventually, she opened a 529 plan and contributed small amounts. Her daughter is interested in the arts, so she knew that could be a possibility for her.
Prior to this, she and her daughter didn’t talk about paying for school, they only talked about where she wanted to go. Initially, she only wanted to study abroad.
Xiomara took her daughter to The Gym’s Wine and Learn about moving and living abroad. They both realized how expensive that would be.
Prior to working at The Gym, Xiomara was in education, because she loves teaching. When she became a client, she learned a lot about finances, and she created a curriculum to use with her students.
The curriculum had a section on budgeting and it went over how to create a shopping list, by looking at the supermarket circulars, and how to pay for rent.
Xiomara wants to make sure her daughter is educated and she wants to create generational wealth.
As a kid, Xiomara would take any money she earned and put it into envelopes, but she didn’t know anything about interest and savings accounts.
Xiomara’s daughter is now a senior in high school. Working at The Gym made it easier to talk to her daughter about paying for college. She didn’t talk about costs right away, but eventually, she showed her daughter her budget little by little.
Xiomara talked to her about the numbers, including student loans, types of loans, and benefits of each, and when her daughter decided on the school, they looked specifically at that financial aid package and their conversation was more streamlined.
Her daughter did get scholarship money, but Xiomara and her daughter both still need to take out loans. They also talked about career opportunities her daughter will need to look into after graduating, in order to pay back the loans.
Xiomara supports that her daughter wants to do something that is a passion for her, but she still wants her to understand that she will need to have a job that pays the bills, provides a 401k, provides health insurance, and gives her the opportunity to perform on the side.
Xiomara didn’t push her daughter to only look at schools that were lower cost or free, because she didn’t want her daughter to resent her later or feel like she isn’t supportive. Right now, it is about educating her daughter about the possibilities and what they can put in place to make sure she is successful both professionally and financially.
Since Xiomara has been talking to her daughter about finances, her daughter has been more open about different conversations, both financial and otherwise, and she sees Xiomara as a partner.
Her daughter started her own emergency fund and goal savings fund. She started a side hustle of selling things she doesn’t need anymore.
Xiomara gives her daughter a monthly allowance, and, previously, her daughter would just spend it. She had a conversation with her daughter about saving the money and talked to her about ways to cut back on her spending, so she could save for things she wanted to do.
After becoming a client and then an employee of The Gym, Xiomara started talking about finances to friends and family, and her daughter saw that. Xiomara wishes she had started talking about it earlier with her daughter and teaching her about saving. The earlier you talk about money the easier it is.
For college, Xiomara’s daughter will be taking out loans under her name and Xiomara will be taking out Parent Plus loans. The plan is for her daughter to come back home and get a job. Her daughter’s responsibility will be to pay her loans, save money, and contribute to the Parent Plus loans.
Financial Trainers prefer federal loans over private loans, but recommend first saving an emergency fund and paying off debt.
When sorting through all of the options, Xiomara’s support team was her trainer. It was helpful for her to talk to someone about it.
Her daughter will now be going to college in New York. Throughout the process and school visits, her daughter looked at class size, programs, short-term study abroad options, and scholarships.
Xiomara had a travel fund, but when they started with the college process, that account changed to be used for college applications, school visits, fees, etc. This was helpful, because it didn’t affect her other income and it made the process less stressful.
Start saving for expenses as soon as possible, preferably start by freshman year of high school. Her fund will now be used for travel/dorm expenses.
Her daughter is now saving her allowance for future school expenses.
Resources Mentioned