Newswise — For many college students, the first semester away from home is the first time that they must focus on money and budgeting, since Mom and Dad won't be right at hand to bail them out if their paychecks from their jobs aren't enough to cover their expenses. The credit card they received for "emergencies" may become a way to pay for more restaurant meals, clothes and other items.
However, by becoming organized, setting financial goals and following a budget, college freshmen can conquer any money woes, says Paul F. Goebel, the director of the University of North Texas Student Money Management Center. The center, opened last year, provides personal financial and money management education to students.
Goebel and Danielle Champagne, assistant director of the center, give the following advice for new freshmen and their parents:
1. Have a conversation about money management and behaviors. Start by discussing systems that the new freshmen will use to organize paycheck stubs, receipts, bank and financial aid statements and other financial paperwork.
2. Realize that a system that works at home may not be adaptable in a residence hall. Consider using a locked file cabinet or locked bin to store financial records as a protection against identity theft.
3. Set up one central location in the residence hall room where all paperwork is kept, a specific time during the month to pay bills and a place to file the paperwork after the bills are paid. Consider having the freshmen pay bills as soon as they receive money or get paid, and treat paying bills like a class assignment, writing the bill's due dates on planners and desk calendars.
4. Discuss the students' financial goals for the next semester or academic term, and how they plan to save for large expenses such as a car or a trip at spring break.
5. Both parents and students should share their expectations about how the students will spend and save their money while they are away from home.
6. Discuss the use of credit cards. Consider starting with a limit of $500 on the card, which is enough to cover emergencies such as car repairs. If the card is for spending other than emergencies, students and parents should determine what expenses will go on the card, such as gas for trips home. If a student makes a mistake and charges too much, his or her parents should talk about a payment plan.
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