As a parent, you want the best for your child and want to make sure they’re fully prepared before heading off to college. When it comes to teaching them about money management, use the three tips below to help them get ready for financial independence.
Arm your student with personal finance basics. Some topics to cover with them include:
How to use an ATM
How to write and deposit checks
How to use person-to-person transfer service
How to use a debit/credit card
How to determine their cost of living
How to make a budget
These are important things they’ll need to know, especially once moving off campus or subletting an apartment for summer becomes an option later in your student’s college career.
Encourage your child to open their own independent financial account that includes both checking and savings. A checking account will give them a way to complete transactions and pay bills. A savings account will allow them to set money aside for future goals and start their own emergency fund.
Even if your child already has their own account, take time to consider whether it’s the best account for them. Guide your child in determining what they should look for in an account, such as:
Easy and surcharge-free ATM access so they don’t get charged to access their money
Convenient tools to transfer money between individuals so they can easily split shared costs, whether it’s a restaurant check or monthly utility bill
No monthly maintenance fees so their cash doesn’t get eaten away by unnecessary charges
No minimum balance requirements since students are often not able to maintain large balances in their accounts
When helping your child decide where to open an account, look for a financial institution that operates in their best interest, with no or low fees and easy-to-use services, like PSECU. We offer checking accounts with no minimum balance requirement or monthly maintenance fees, and students at schools within Pennsylvania’s State System of Higher Education, as well as many other schools, are eligible for PSECU membership. Once your student has their own account, they can learn how to manage their money by checking their balance and using other services such as ATMs, debit cards, and digital banking. And with PSECU, they can keep the same account they open in college after they graduate without worrying about new fees being charged once they’re no longer a student.
Your child may have to take out student loans to help pay for college. Make sure they understand the debt they’re taking on, how it can impact their finances later, and why they should only borrow what they need to pay for education-related expenses.
In addition to student loans, your student may receive credit card offers while they’re in college. Make sure they understand how credit works and what responsibility they’re taking on if they choose to open a credit card.
By helping your student understand responsible borrowing before they go off to college, they’ll be better prepared to face these financial decisions now and protect their credit in the long term when they have needs like auto or home loans.
Preparing your student for financial success can feel like a daunting task, but we’re here to help.
We have a presence on many college campuses across Pennsylvania. PSECU members at these campuses have free ATM access, as well as the opportunity to visit our on-campus Financial Education Centers to ask questions and attend free financial wellness events. Plus, regardless of where your child enrolls, we have a Resource Center with over a hundred articles designed to help anyone learn how to manage their money well.
Like you, we want to see your child have a successful financial future. A college education, along with a strong foundation in money matters, will go a long way toward making that a reality.
For more money management resources, visit our WalletWorks page.