Families go through a number of stages but one of the more interesting is the, "I’m leaving home" moment when teens go off to college. For some parents who have been barely able to live through the rebellious teen phase, this is welcome relief. For others whose relationships have stayed more positive, it can be a big change when you no longer have them round the house. Whichever side you fall on, one thing is certain. This is not the time to sit back passively. This is also a big financial change and you should work out the implications before they come back to haunt you. Let’s start off with all the stuff they may move out with. Just how much value have they managed to accumulate behind those bedroom doors and what will they be taking with them? Take out your homeowners policy and think about the difference between the value of the contents before and after they go. Assume they are taking televisions, all the digital music equipment, PCs, game consoles, and handphones. Then there will be clothes, skate boards, and whatever else teens depend on these days.
Now where will all this be going? There may be a hall of residence, or will they be trying to get into fraternity or sorority houses. Perhaps they are renting off campus. Wherever they end up, there will be less security than in your home. In all the excitement of life, some of this property is going to be damaged or lost. Now look at the small print of the policy. Some policies limit the amount of cover when a certain percentage moves out to college. If you think more than 10% of the value of your contents is moving, think about buying extra cover. If some individual items are expensive, you should put together a schedule and have them separately covered. More generally, keep records of the makes and models of everything, including the serial numbers. Find the receipts as proof of purchase. And put permanent marks on everything.
When it comes to transport, if your teen has been a named driver in your family car, you will save money if he or she will not be driving it while away. Should your teen have a vehicle, you need to notify the insurer that it will be kept at a different address. Except in California where the use of ZIP codes has been restricted, insurers base the premium rates on where the vehicle will be "living". This will be particularly important if the vehicle is going out of state. Auto insurance is not uniform from one state to the next. There are different mandatory liability provisions, some states are "no fault" and so on. All of this needs to be factored in whenever the change is due. Ensure you get auto insurance quotes based on all the new information. Equally, check with the college. Some have deals with local insurance companies and offer attractive rates to students with good GPAs and defensive driving certificates. If you play you cards right, you may end up with a quieter life around the home, and savings on car and contents insurance.
