5 Things Your New College Student Should Know About Banking
As I write this post, my 4th child just graduated high school and will be entering college as a freshman. Just like I told his older siblings, even though I may see you as my child, the business world recognize you as a new naive legal adult. A person eager to make adult decisions and enter into binding contracts.
You can’t protect your adult children from all the legally bibding comitments they get into, but hopefully you
can take the information from this post and help them with their banking choices as a college student.
Tip #1 – High School is over
Did you know that millions of dollars flow to colleges that have agreements with banks to allow marketing to their new students. The problem with that is the accounts being marketed by the banks to our naive young adults usually carry high fees and risky terms. Be aware of this and don’t allow your student to assume that their college has taken the time to ensured that the bank they are pushing has the best terms.
Tip #2 – Don’t let “Fear” be used as a tool against your student
OverDraft Protection is a joke. They say its protection is to avoid high fees. Its really a service that allows the bank to charge fees when you overdraft. Tell your student to decline the service and allow their card to just be decline when there is not enough money in their accounts.
Yes, it can be embarassing, but 1 or 2 times of being declined will encourage your student to pay attention to their account
Within the first few days of school, have your student find their bank and bank’s ATM’s. Once located, do all banking at those locations. To not do so, can result in excessive charges for
out-of-network bank and ATM fees, which also can include fees paid to the ATM owner.
Tip #4 Don’t Put All Your Eggs In One Basket
Finding a bank that can give you a great service bundle can be difficult. A bundle that includes Free Checking, wide access to ATM’s, Free Savings that provides some interest on your money.
Have your student consider opening an online savings account with great terms to go along with their brick and mortar checking account bank with great terms.
Tip #5 – What happened when they graduated high school
Chances are that when your student graduated high school or reached 18 years of age, their youth checking account automatically converted to a regular checking account. In most cases that means additional service fees. It may be a good time to change banks!