Financial Options for College Students

Many college students still rely on their parents for financial support throughout most of their college years. It used to be a bit more difficult in past years to “share” money but in today’s society there is many more option for making money available to far-away college students. One of the more common ways for parents to ensure students have access to funds is by establishing a joint bank account, either checking or savings, where both the student and the parent can make deposits and withdrawals conveniently. Students can write checks or use a bank card to purchase books or other supplies they might need.

Students may also be listed on credit cards as an authorized card user. Parents can set spending limits, often through the card company and must establish guidelines for responsible spending and credit card usage until the student is ready to begin building up their own credit.

Another option outside of traditional banking methods can be done through Paypal, where an account can be accessed by both student and parent nearly instantaneously. While a bank account is a requirement of the account setup process, parents of students who may attend school outside of the state or in an area where there are no branches of the banking institution, can utilize the service to transfer money into the student’s account, and the student can access the funds through the debit card at an ATM or most retail locations.

Obviously, cash is an easy option but perhaps not always a wise one. Having a large amount of cash on hand can leave the student vulnerable to thief or other criminal acts. Also, it may be a temptation for the student to spend it frivolously simply because it’s there.

Not matter what route you choose to take, parents and their children need to work together to develop a solid, working financial plan. Each party should know exactly what is going on and what is expected. If a student is given a credit card for use at school, there needs to be an understanding of who is paying the bill and what purchases are approved. Both parent and student need to keep an open line of communication about money matters and have realistic expectations. For many college students, this will be the first lesson in real world responsibilities. Having a solid foundation financially as a student will help to better prepare them for the future outside of the campus.

There are many options to consider during what is usually a hectic time. Being prepared before sending your kids off to the dorm is everyone’s best interest. Research the financial options available to college students and parents. Contact the college and ask for planning materials and other information that can help keep things in perspective. College educations are certainly not getting any cheaper and financial issues should not be kept hidden from the student. It is an excellent life lesson for the next generation of adults.

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Tisha Kulak is a writer for www.creditorweb.com, where she writes about student credit cards and responsible credit card use.