Financial independence. It’s a tricky one. Amidst deadlines and term papers, why worry? Students should!
Take some time to teach your student to navigate financial waters before they are on their own to avoid trouble with credit cards, overdraft fees and other tricky financial woes.
Here are a few steps to take now, so you don’t have to bail your son or daughter out later.
- Teach budgeting. If you deposit a semester’s worth of spending money in your student’s bank account at the start of the term without discussing ways to make it last, don’t be surprised if you get a phone call asking for more money before the semester is over.
Make sure they have a clear picture of what their monthly expenses will look like so there’s no shortage along the way.
- Use caution with credit.College students get bombarded with credit card. Talk with them about how to choose an appropriate credit card and how to use it responsibly to avoid doing serious damage to their credit score.
Use a debit card instead, or a credit card with a low limit. It can minimize the financial harm caused by slip-ups.
- Take advantage of mistakes. There will be mistakes – we all make them – but also allow your student to learn from them.
A little bit of struggle and living on ramen noodles for a month won’t hurt. In fact, it may drive home the lesson that financial responsibility is important.
- Let them work for it. We are all a little more careful with spending money we’ve had to earn. A part-time job – even just a few hours each week – may be all the motivation your student needs to take ownership of their finances.
- Look online. There are a number of online resources designed to help money management. Check out Mint.com, MyMoney.gov or BudgetTracker.
Learn how Westface College Planning can help you navigate the college planning process from start to finish. Give us a call at (360) 818-7728 or use our contact form. Our workshops and webinars are also a great place to start.
Photo Credit:David Siu