Finances & College Freshman

Getting College Students Ready to Manage their Money

Tips from Dr. Mary Ann Campbell, CFP and Elisabeth Donati, Founder of WinTheMoneyGame.com

·        Let your freshman know where the money will be coming from for certain expenses. They must know what financial responsibilities are theirs and which ones their parents are going to handle. 

·        First, don’t get them a credit card as a freshman. Open a bank account and allow a debit card the first year.  Offer a credit card as a reward once they prove they can manage their money.  They must know how to manage their own money through using a debit card and checking account before they can be trusted with using other people's money for short periods of time.

·        Work out a tentative first semester budget.  Consider a save/spend tracking program such as Mint.com to help them keep track of their spending. Allow them to make mistakes without micromanaging them.  If your soon-to-be student is moving into a dorm, there is very little he or she needs. Agree on a budget and let THEM make ends meet

·        It's important to put your freshman in charge of their own financial needs as soon as possible. This means taking the money you are agreeing to be responsible for providing and running it THROUGH them instead of outright buying things FOR them. Remember, it's only through repetitive practice as something do we develop skills. Money is no different. Don't agree to pay for everything. Most adults admit that when they had to participate in paying for their college experience, they were better students and better stewards of their financial resources.

·        Challenge them to be thrifty. Encourage them to go to thrift stores and garage sales to find the items they need. There is no need to buy new. This teaches resourcefulness and fosters creativity in the student. Allot a certain amount of money for textbooks, and allow them to keep the difference if they can find their books for less.  Discuss the human nature pitfalls of fast food expenses, picking up the tab to be popular, and entertainment expenses. Encourage your student to use campus services such as printing in the computer lab, health services, free or inexpensive entertainment, student discounts on campus and in the local business community.

·        Promote discussion during the semester and encourage your student to inform you quickly of problems, such as a mooching roommate, or unusual expenses.