When your child is starting college, preparing for their eventual internship is a forward-thinking move. The financial issues you address during this time can set them up for success and help them navigate the transition from education to the workforce. Here are the key financial topics to focus on before your child begins an internship:

1. Budgeting and Money Management

• College Expenses: Help your child create a budget for tuition, books, housing, food, and personal expenses.

• Internship Costs: Discuss potential costs related to internships, such as professional attire, transportation, and relocation.

• Savings Plan: Encourage saving part of their income from part-time jobs or summer work to cover future internship costs.

2. Financial Literacy for Internships

• Income Management: Teach your child how to manage their income if the internship is paid, including budgeting, saving, and handling taxes.

• Understanding Compensation: Help them evaluate the benefits of unpaid vs. paid internships, including networking opportunities and skill development.

3. Emergency Fund

• Build a Cushion: Ensure your child has an emergency fund (e.g., $500–$1,000) to cover unexpected expenses during their internship.

• Parental Backup: Set expectations on whether you’ll assist with emergencies or if they’ll need to rely on their savings.

4. Transportation Planning

• Evaluate Costs: Determine transportation needs for the internship, such as public transit, ridesharing, or a personal vehicle.

• Car Expenses: If your child uses a car, budget for gas, maintenance, parking, and insurance costs.

5. Housing and Relocation Costs

• Relocation Expenses: If the internship is in another city, plan for moving costs, deposits, and short-term housing.

• Subsidized Housing: Research whether the internship provides housing or stipends for living expenses.

6. Resume Building and Career Planning

• Skill Development: Budget for courses, certifications, or workshops that enhance their qualifications for internships.

• Professional Wardrobe: Allocate funds for business attire or professional clothing suitable for their internship role.

• Networking Costs: Include costs for networking events, business cards, and LinkedIn premium memberships.

7. Taxes

• Taxable Income: Explain that paid internships are taxable and help them understand how to set aside money for taxes.

• Filing Requirements: Teach them how to file taxes, claim deductions, or understand W-2 and 1099 forms.

• State Taxes: If the internship is in another state, review tax implications for working out of state.

8. Student Loan Planning

• Evaluate Loan Impact: Discuss how taking on an internship may influence their ability to make early payments on student loans.

• Grace Periods: Review loan repayment schedules, especially if the internship extends beyond graduation.

9. Insurance Coverage

• Health Insurance: Confirm whether your child is covered under your policy during their internship or if they’ll need coverage through the employer or school.

• Renters Insurance: If they’re moving for the internship, consider renters insurance to protect their belongings.

10. Internship Stipends and Scholarships

• Seek Funding: Research scholarships or grants that support unpaid internships, especially for nonprofit or government roles.

• Understand Stipends: Clarify how stipends are paid and what they’re intended to cover.

11. Career Development Costs

• Interview Prep: Budget for travel expenses if the internship requires interviews in another location.

• Portfolio Creation: Invest in tools or materials to build a professional portfolio, such as graphic design software or photography equipment, if relevant.

12. Bank Accounts and Credit

• Open a Bank Account: Ensure they have a checking account with online banking to manage direct deposits and expenses.

• Establish Credit: Teach them about building good credit through responsible credit card use.

• Monitor Spending: Help them track and manage expenses through budgeting apps or spreadsheets.

13. Networking and Professional Growth

• Membership Fees: Consider professional associations or industry groups that require membership fees.

• Events and Conferences: Budget for attendance at conferences or networking events relevant to their field.

14. Long-Term Career Goals

• Evaluate Internship ROI: Discuss how the internship fits into their long-term career plans and potential return on investment.

• Post-Internship Plans: Help them plan for the transition from internship to a potential job, including saving for relocation or professional certifications.

15. Parental Support and Independence

• Clarify Financial Support: Define what expenses you will or won’t cover during the internship period.

• Encourage Independence: Use this phase as an opportunity to let them practice financial independence in a safe environment.

By addressing these financial issues before your child starts their internship, you’ll equip them with the tools they need to manage their finances, focus on their professional growth, and transition smoothly into the working world.