Do your children earn an allowance? Is your teen ready for a checking account? Does your college student save money from his summer job to use next semester? Stephanie Sarkis, author of Making the Grade with ADD: A Student's Guide to Succeeding in College with Attention Deficit Disorder, addresses these questions to help parents guide their children to better financial literacy.
Q: My son is about to begin his freshman year of college. He has already spent the money he earned from his summer job. I’m considering sending him to college without any money, but my husband disagrees. What’s the best way for us to teach him to learn from this situation?
Stephanie Sarkis: I think the fact that he’s spent all that money is a great learning tool. You can sit down with him and say, “Okay, so you had this many dollars and you spent it. Let’s see what we’re going to do now. What are some of your suggestions?” That makes him take some responsibility.
Give him a prepaid credit card; you put the cash on it and when that money is gone, it’s gone.
A checking account for him with an attached savings account you control; you can transfer money into the checking account from the savings account as he needs it.
Help him to create a budget, tracking his income and expenses. Discuss with him some tools that help him manage his money, including computer programs and filing systems.
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