Using Technology to Manage Finances
Managing finances has changed a lot since reconciling checkbooks by hand and keeping personal accounting ledgers was the norm. While technology offers alternatives to the methods you may have been taught – or still use – that doesn’t mean managing finances is any easier for your college student.
Consider a few free products and tools to help your student keep track of money and our advice on using technology securely and safely.
Free products and tools
Your student can monitor his money, budget, set goals and receive free advice through Mint.com. After creating a free account, your student can access all his financial information, including income, transactions, investments, spending, trends and ways to save. By logging on to the website or using a free mobile application, your student can rest assured that all the data is protected and validated by the same security system banks use.
Of course, nothing is 100 percent secure or guaranteed. Parents and students hesitant to use Mint.com fear providing bank account and password information to a third party, or they worry about hackers accessing all of their financial data. Although Mint.com boasts 4 million users, that doesn’t mean it’s right for your student. Help him do his research and decide for himself. Check out this New York Times blog from July 6, 2010 that explores whether or not Mint.com is trustworthy.
Online bill pay
For many college students, a trip to the mailbox is nearly as rare as a trip to the post office to buy stamps. So mailing off checks can be a hassle that results in delinquent payments and late fees. By using online bill pay, your student can monitor and pay his bills from his computer.
Most banks have an online bill pay service, some for a small fee, which allows users to specify payees, payment amounts, payment dates and ongoing or automatic payments. Another way to pay bills online is through the specific service provider. A utility company, for example, might have a login for customers to sign in and pay through their website.
The nuts and bolts of security
Making payments and monitoring sensitive account information online runs the risk of your student’s information getting into the wrong hands. Your student can make security a priority by educating himself on the following:
When accessing the internet wirelessly, always connect to a secure network. That means if your student is in a coffee shop with free wi-fi, he will provide a security key or password to get online. When using public computers, he should always log out of all sites before stepping away from the computer, including e-mail, bank sites, facebook, etc. If your student has wireless at his apartment, direct him to these recent tips from My Techno Guide, which will help him ensure that his connection is secure from hackers.
http vs. https
When surfing the web, your computer uses a browser (like Firefox or Explorer) that talks to servers hosting websites. The beginning of a web address, “http://” stands for hypertext transport protocol, which is basically the language or protocol that your browser uses to talk to the server to retrieve the site. The language between the browser and the server is only secure if the beginning of the web address is “https://” which stands for hypertext transport protocol secure.
In a nutshell, someone can eavesdrop on the browser’s conversation with an http site, and information transmitted to a site is only secure if it’s an https site. So advise your student to never give credit card information or other sensitive information to an http site.
There is no shortage of foreign ambassadors or Nigerian princes emailing personal accounts and asking for a little help to transfer money in exchange for a healthy compensation. While most people recognize these emails as scams, there are more subtle forms of identity theft and fraud, like phishing. Instant messages, facebook posts and emails that claim to be from a legitimate company send anyone who clicks the link to a look-alike site. Oftentimes the website address is off by one or two letters, but it looks identical to the real site.
These scams ask for users to update their information – passwords, addresses, credit card numbers – and then steal the information. Moral of the story: don’t click on suspicious links and always double-check the web address before submitting any information.
As financial transactions, relationships and business dealings continue toward the paperless trend, no one is immune to online security breaches. The threat is at all levels: Recent international marketing firms and electronics companies have joined the ranks of those whose customers’ information is stolen by hackers. From browser cookies to Smartphone GPS information, all users’ moves are tracked.
The best protection is vigilance; encourage your student to understand the basics of how his hardware and software works and where identity theft dangers lie. Check out the Federal Trade Commission’s Identity Theft site on deterring, detecting and defending against identity theft for more information.