5 Financial Lessons to Teach Your College Student
Graduation season is upon us! This means we should be helping our college-bound students with some sound financial advice to make sure they don’t overdraw their checking account or accumulate massive amounts of credit card debt. Here are 5 Financial Lessons you can teach your child, grandchild, niece or nephew before they leave for school:
Open a low cost checking account in your child’s college town. Find the best combination of low balance requirements and low (or zero) fees. A great website to do comparison shopping for bank accounts is www.checkingfinder.com. Also, choose a bank with a network ATM that is located on the child’s college campus. This should avoid any ATM fees.
Set up an overdraft strategy. Link the child’s checking account to a savings account. Keep in mind that some banks charge for the automatic overdraft protection so be sure to ask. Have your child sign up to get balance alerts via email or test when his/her balance is low.
Don’t use credit cards. New rules require that young people under 21 have a co-signer when they apply for a credit card. As a parent, think twice before signing. Your student should first be responsible enough to manage a checking account. If he/she doesn’t overdraw his account, he/she may be mature enough to handle a credit card but don’t rush it.
Guard against identity theft. Set up one account that is used exclusively for online purchases. Have them keep a minimal amount of money there. That way, if the account is hacked, they lose very little.
Keep track of expenses. Student services should be able to estimate how much the average student will shell out for entertainment, travel, food and miscellaneous expenses.
The Bottom Line: Our children are the future. Ensure your family has proper and proactive financial guidance before they get lost in the excitement of college. Is your family’s hard-earned wealth on the right track? Work with Reno financial advisor Jon G. Sanchez to develop a plan for the future.
Jon Sanchez is a registered representative offering securities and advisory services through Independent Financial Group, LLC (IFG), a registered broker-dealer and investment advisor. Member FINRA/SIPC. OSJ Branch: 12671 High Bluff Drive Suite 200 San Diego, CA 92130. Sanchez Wealth Management, LLC and IFG are not affiliated entities. CA Insurance Lic. #0772626.