Packing for College – the financial stuff

I have quite a few friends who will be packing up their college bound teens this month for their freshman year. I personally am a few years away this big event, but it got me to thinking about how to prepare my daughter and our family for college. I’m not talking about the traditional preparations like paying for college, packing the car or preparing for my tears after we drop her off. It’s all the miscellaneous financial matters we will need to consider such as spending money, credit card for emergencies, small mortgage for text books and health/home owner/auto insurance coverage from afar.

This summer we opened up a checking account with an ATM/debt card for my daughter. She’s had a savings account since she was 5 yrs old so I thought this would be a snap for her. However, it has taken her a few months to get used to whole idea of ATM machines, writing checks, swiping debit cards and checking her balance on-line.

We are happy to report that she has been depositing her allowance and her summer paycheck into the checking account. She’s been learning to use her debit card and the ATM for the movies and trips to the mall. Plus she wrote her first check to pay for her driver’s ed class. This was all in the name of financial education but I didn’t realize that I was also preparing her for college life.
Don’t wait until your teen is leaving for college to open their first checking account. It’s important for them to learn to use an ATM and write a check. Having a debit card will get them ready for a credit card. Learning to only spend what you have in your account is a valuable lesson in preparation for using credit wisely.

The Wall Street Journal’s Personal Finance section has three great articles on the subject of college and finances that are worth your time to read:

“Packing for College, 2010 Style” by Karen Blumenthal – great advice from checking your health insurance policy for coverage at college to home insurance policy covering dorm contents to credit cards for your college student.

“How to Tame College Costs – It’s not Just Tuition” by Anna Prior – great information on all the hidden costs of college life.

“When Student Loans Live on After Death” by Mary Pilon – sad article and hopefully you won’t have to deal with this issue but important information to know about co-signing private student college loans.