Did you know that the average college student graduates with $4100 in credit card debt? This does NOT include tuition and books. Now is an excellent time to teach money management tips to your high school student to ensure responsible spending when they leave the nest and enter college.
My first tip is to open a checking/savings account for your kid. This will allow them to start to learn the basics of money management. Pockit Review – Many institutions offer a service that notifies you via email or text message if the account falls below a certain balance. Set the threshold high enough that you don’t get caught with overdraft fees. You want to teach your kid how to manage money – but you don’t want it to cost YOU money! If your kid falls below the threshold – charge him an overdraft fee.
Next Pockit Review, I would set him up with a debit card.
It’s often difficult to manage money when you are able to withdraw funds anytime you want. Plus, the balance shown at the ATM is not always up-to-date. It is important for your student to understand that checks written do not post immediately. Also, ATMs can charge withdrawal fees. Plus, most gas stations will allow overdrafts if you pay at the pump, but will not accept a debit card inside if there are insufficient funds. All of these scenarios can cause the inexperienced money manager to overdraft their account. Again, chose an institution that notifies you when the balance is low – so you can teach the life lesson without paying for it!
Pockit Review – Another strategy that can be implemented while your student is still in high school is to create a budget. How much do they earn at their part-time job? How much do they anticipate receiving for holiday and/or graduation gifts? What are their expenses? Once you create the budget, make a point to revisit this budget each month and revise as needed. This revision process will allow you to help your kid begin to plan for big expenses (college books) and decide how much to put away each week in savings.