In 18 years, when a baby born today goes to university to start an undergraduate degree, the total cost of a four-year program for a student living away from home will be $137,013.

Coincidently, last week I also spoke to 250 grade 12 students about why it’s important to start thinking about your financial future today. In that talk, I shared with them the table below, which outlines the yearly high, low, and average costs of going to an undergrad program at a university in Ontario.

As you can see, the cost of going to school today is already high, and while some parents may opt to pay for their children’s education, with rising tuition costs, children are going to have to burden some of that debt – if tey aren’t prepared to manage that debt, it could take them over 20 years to pay it back.  So if you haven’t started talking to the yonug people in your life about why they need to care about managing their money now, isn’t it about time you did?

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When it comes to managing expenses, you have to be able to understand both your current and future expenses – if you don’t understand what your future expenses will look like, how can you ever create a budget to meet them? If you dream of moving out of your mom’s basement, but have no idea how much living on your own costs, how will you afford it?  You need to understand what your future costs will look like so you can start saving today.

One of the areas that people tend to overlook is dating – no, I don’t mean the actual act of dating, but what dating someone with debt looks like.  There’s a good article over at MarketWatch which looks at just this – what happens when two people with debt decide to get married?

Being in love and in hock is no way to go through a marriage, because being in hock might just put the kibosh on the love, particularly in the early years. Debt, it turns out, is a leading cause of family strife during the first few years of marriage, according to Creighton University’s Center for Marriage and Family.

That doesn’t mean debt will necessarily send you to divorce court, but it does mean the accumulation of debt can undermine your marriage and cause the type of discord that can dissolve a marriage.

The article is a little long but makes a good point when it says that couples need to discuss and agree on these two things:

1. Debt philosophy – what is each person’s view on debt, and how do they handle debt?
2. How debt will be used – when you will and will not use debt

Managing your own debt can be challenging enough, so you shouldn’t have to manage someone elses.  Before you decide to make a serious committment to your partner, make sure that you both understand what debt is, and when you should and should not use it.

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