Of course, not all college lessons are taught in the classroom. College also presents an opportunity for students to develop money management skills and habits which will serve them well for the rest of their lives.
Joan Jensen, president and CEO of the Central Credit Union of Illinois, visits ABC7 with advice for college-bound students and their parents.
Smart money tips for college students
As August approaches, so to does the annual trek to college. In addition to acquiring the information and skills necessary in building a life-long career, college also presents a learning opportunity that can help students develop good money management skills and habits, which will serve them well for the rest of their lives.
Joan Jensen, president and CEO of The Central Credit Union of Illinois offers the following recommendations for parents and students who are keen on making the most of their college-related experiences and expenditures.
START WITH A GAME PLAN - Students and parents should discuss money issues long before school starts. Both parent and student should have a clear understanding of what is expected. Some important topics to cover include:
Make a list of who will be paying for the different expenses and how much each of the expenses will cost. For the student's portion of the expenses, determine if it will be paid from savings, summer employment, a part-time job during the school year, or a student loan. Some of the major costs include:Room, board, tuition, and incidentals Will there be a monthly allowance? Will there be a car? Who pays for gas, maintenance, and insurance? Traveling between school and home How will financial emergencies be handled?
The best way to not be caught short of funds each month is to have a written spending plan and a commitment to stick to it. Think ahead and list anticipated monthly expenses including such item like:Laundry expenses Personal grooming expenses—haircuts and toiletries School supplies Sorority/fraternity/club dues and activity fees Entertainment
Cash, Checks, Debit and Credit Cards
Shop around for financial services BEFORE heading off to school,. Compare rates and services before opening any account. With home banking and electronic services, you can either choose a financial institution close to home or school. Look to see which financial institution provide the best options and lowest cost. And don't forget to consider credit union options.Look for a free checking account linked to your savings account or with free overdraft protection. Use home banking to monitor your account and pay your bills. Look for a low fee, low interest rate credit card. New Federal regulations may require you to have a qualified co-signer if you do not have the financial resources to pay your credit card balance on your own. Use credit wisely. Buy only what you can afford and pay your balance off in full and on time. For everyday use, consider using a debit card instead of a credit card. A debit card may limit impulse spending. Manage your accounts wisely. Mismanaging a checking account or a credit card account could result in account closure and the denial of future services.
BE BOOK SMART - Before heading over to the campus bookstore, first look into all the options.Online book renting portals like Chegg.com and BookRenter.com are valuable and reliable resources for lessening the burden - and cost - of textbooks. Many textbooks can also be purchased new or used at multiple online sites.
TAP CAMPUS RESOURCES - Seek out upper classmen who know the ropes. Find out where to get the best deals.Seek recommendations from campus student service organizations or the Financial Aid office for part-time, student-friendly jobs. Check with the Financial Aid Office, Dean of Students, and Faculty Department Chairmen for scholarship money. Don't be shy and don't give up. Apply early and often throughout your entirecollege years.
BEGIN WITH THE END IN MIND - Start and stay committed to the idea of graduating and leaving school with no credit card debt and only the minimum amount of student loans.