Financial Advice for College Bound

October 01, 2008

Between packing for college, buying school supplies and recovering from sticker shock, parents may be too bogged down to remember to pass on some financial words of wisdom as their child leaves the nest. To help college bound students build a foundation of sound financial habits, Better Business Bureau offers the following advice for parents to bestow on their freshman.

College years are the time when many young adults establish habits they will carry with them for the rest of their lives and while it’s important that they tackle academics, its critical that they also learn everyday skills – such as how to manage their money – in order to become successful in life.

The BBB recommends that before parents wave goodbye to their college bound students, they sit down and discuss four key rules for managing personal finances:

    Be responsible with credit cards. While having a credit card is an important first step for a college student to start building a credit history, parents need to stress the importance of using credit responsibly, a minimal number of credit cards, paying off the balances every month and keeping a reign on spending.

    Start saving money now, even if it’s just a small amount every month.
    Developing good saving habits early on will help a college student reap the benefits throughout his or her life.
    Pay your bills on time. U.S. PIRG found that more that 40 percent of college students who managed their own credit cards had paid bills late or paid at least one over-the-limit fee. Credit card companies often charge late fees as high as $40.

    Guard your personal information. When comparing the age demographics of ID theft victims in the U.S., young adults between the ages of 18 and 24 were the second highest age group at risk for fraud according to an annual survey by Javelin Strategy and Research.
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