4 Financial Planning Tips Parents Should Share With Their College Students
By Kathleen Farrell Jenkins, Affinity Federal Credit Union member and college-mom
Although I remain firmly entrenched in summer, with baseball camps, the beach and backyard barbecues, it seems that parents everywhere are getting ready for back-to-school. You can’t miss the ads and store displays featuring extra-long sheets, back packs and laptops. While these are all important, so is planning for how your almost-adult child will manage his or her financial needs in college.
When my daughter was preparing to go away to school, we had to decide whether or not she needed to find a new financial institution closer to campus. Like most parents, I worried about her adjusting to campus life and managing money on her own. With the advent of technology and mobile banking, I soon realized that she could use her existing account, but how could I ensure she knew how to budget and practice smart spending habits? She had been a credit union member since she was little, but until the point she was college-bound had never taken an active role in her finances. She relied on me to make her deposits, withdraw money and pay bills. Now that she was going to be “on her own,” it was time for a little financial education and there were four key things she needed to do.
1.) Get a debit card. This would give my daughter the flexibility of paying for everyday purchases without having to use cash or checks. I also made sure she became well versed in how to diligently track her withdrawals.
3.) Set up text alerts. Though I had already linked our accounts so I could transfer money to her when she ran short, I set up text alerts to avoid overdrafts and be on the lookout for unusual account activity. Speaking of which, I made sure that our credit union knew she was going to school in another state, so they didn’t freeze her account when charges for pizza deliveries started showing up several states away.
4.) Learn how to use the shared banking network and find out which ATMs were fee-free, as well as how to find them. Fees can sneak up on you, especially when you’re withdrawing money. It was important that she understood this, and was always aware of her options.
I am proud to say we made it through the first two years and my daughter has become much more financially savvy. With my son getting ready to graduate from high school this year, we are ready for the next chapter in his life. By following these tips, you’re taking steps in the right direction to confidently send your child off to school.