Tips for Parents of College-Bound Students

High-school students bound for college will embark on many new experiences–including financial independence. Here are some tips for parents to help kids prepare for what’s in store.

* Explain how credit works. A credit card is not free money; it’s instead a means of putting off paying for purchases until a later date. Accompany your child to the credit union for the best rates on credit cards and consider urging him or her to use a debit card instead.

* Create a spending plan. Write down all college expenses such as tuition, books, room and board, toiletries, entertainment, and so forth. Determine which expenses you’ll be paying and those for which your child will be paying.

* Come to a no-bail-out agreement. If your child ends up charging more than he or she can afford, or runs out of money before the end of the month, your first reaction may be to send money and bail him or her out. Don’t do it. If your child needs to figure out a way to get out of debt, such as working or staying home on weekends, chances are good he or she won’t make the same mistake twice.

Want a few more ideas?