GoodLifeFamilyMag.com MARCH | APRIL 2019 57 You’ve got a child going off to college. It’s an exciting time, but there’s a lot of practical information you need to cover with your son or daughter before they go off on their own. Handling their own finances may be completely new to them. Maybe they’ve had an after-school job and have taken care of some of their own expenses. As they prepare to leave home, make sure you’ve discussed your expectations and how their money will be handled during these next four years. Chuck Cowell, Vice Chairman of Guaranty Bank calls it “the good, the bad, and the ugly!” How the student sees the situation: THE GOOD: I’m 18 years old, about to graduate from high school, about to be “out on my own” and away from daily oversight by my parents. Free at last!!   THE BAD: Free at last! Except that nothing is free and somebody now has to pay. How do I do that? How do I pay for gas, food, clothes, fun stuff? Where do I get 20 bucks in cash?  (Mommy’s or Daddy’s wallet won’t be lying around.) Who’s going to fix my flat or wash my clothes?  And where in the heck is the dry cleaners?   THE UGLY: It’s all up to me!  It doesn’t have to be an ugly situation if you and your teens take the right steps before they go. Chuck offers some suggestions to help parents and teens make this transition: Q: What basic financial skills should your student have before they go away to school?  A: Hopefully, parents have prepared years in advance to teach their children responsible habits for handling money and budgeting.  Some have, some definitely have not.  This is a must.  Q: Do you need to establish a bank account at a bank in the city where they'll be attending college?  A: If parents have not already established a checking account for their children, they need to do it prior to going off to college.  Nowadays, students can bank at home and use their mobile apps to monitor accounts, make deposits, etc.  The ability to get cash at local ATM’s and supermarkets/convenience stores will usually make it unnecessary for a student to have a local account.  If they have a part-time job, most all employers offer direct deposit. Q: Since they are legal adults, how can you help oversee their spending?  A: Again, most mobile banking apps now offer a low balance alert or email noticing that you are be- low a pre-determined balance limit.  Knowing your local banker who is “watching” their account also helps.  Q: Do you recommend giving them funds monthly?  Per semester?  A: My preference would be smaller sums deposited monthly.  Don’t let them have a large lump sum unless you are very sure they can handle it and are disciplined.  Otherwise, the temptation is usually too great.  Make a budget together and discuss together any variances.  Q: Is it important for students to begin to establish their own credit during college? A: Every student needs to know that it is not just good grades that employers will be looking at when they apply for a job.  Many employers place a high degree of importance on an applicant’s ability to maintain a strong credit score. Not to mention their ability to lease an apartment, purchase a car/home or obtain insurance. WARNING!  Be sure to counsel your students not to sign up for credit card offers, etc. while off at school without discussing with parents.  I have seen some very unfortunate situations where a student opened a credit card with a small balance and then rapidly applied/accepted increases to their limit, which turned into disaster later.  Q: How can your local banker help you during the transition?  A: There is no substitute for knowing a good banker! Editor’s Note: For more information, you can contact Chuck Cowell, Vice Chairman of Guaranty Bank & Trust, at ccowell@gnty.com. www.gnty.com