In many ways, high school graduates are mature young adults ready to live on their own and begin an exciting college career, but are they ready to manage their own finances?
As this is the first time in their lives that they have to budget only their own money, there are things caregivers can do to set them up for success.
1). A current account with no maintenance fees: A basic checking account is the first step to ensuring your child is successful when it comes to spending and managing their money. Whether they’re using a debit card or withdrawing cash, it’s essential that they have a checking account that doesn’t penalize them with an abundance of fees.
2). Mobile banking: With modern college students being so tech-savvy, using a mobile banking app is a no-brainer. Your job is to make sure they install the app and learn how to use it before they venture off to college. A mobile app will help them monitor how much money they have and how much they spend. In cases where they find it difficult to manage their money, you can also use the app to monitor their spending.
3). Budget bases: There are a few budgeting basics that all young adults should know. If you’re not the best at budgeting, there are plenty of tutorials and instructional articles online. Click HERE for an example of a great resource. Before they leave for college, make sure they have a good budget in place for the money they already have and the money they’ll be getting, whether it’s from you, from a scholarship, grant or employment.
4). A credit card reserved for emergencies: It’s no secret that credit card companies pray for naive young individuals who would like to spend the extra money. Tell your child about these solicitations and make sure they don’t start asking for credit cards without telling you. One way to avoid this is to get them a low fixed rate credit card before they leave. This credit card is for emergencies only and should not be spent on frivolous items or experiences.
5). Refinance your car loan: Many banks, such as Champion Credit Union, offer cash back on auto loan refinances. Not only will your student have a little extra money in their pocket, but they will also have a lower interest rate and monthly payment. If the cash back isn’t enough to cover all the back-to-school necessities, CCU’s lifestyle loans are perfect for the extra money they might need for moving or school supplies. Click here to learn more.
To get a head start, many parents and guardians start teaching basic budgeting and money management skills while their children are in middle school and high school. As with everything in life, it is more useful to build on prior knowledge than to learn everything at once. Freshmen will have enough to learn without having to worry about money management. Let’s work together to set them up for success. For more information on account options with Champion Credit Union, visit www.championcu.com/personal/checking.