Kevin Waldron, from Merrill Lynch fills us in on common financial mistakes that college students make and some great advice for parents on how to proactively help their children avoid making these mistakes.
Mistake #1: Credit Card Debt. College students are inundated with credit card applications and without proper guidance credit cards can throw your college student into debt extremely fast. The average college freshman carries over $1,500 worth of credit card debt and by graduation that amount has nearly doubled.
Advice: Choose the right card and advise use for your student.
Mistake #2: Using a bank account from home. When college students go away for the first time, they have their own bank accounts and ATM cards from home. This leads to problems when students are taking money out of ATMs and being charged fees of up to $2.50-$3.00. These fees add up fast and cause bank accounts to disappear even faster.
Advice: Open a new bank account at a national bank.
Mistake #3: Not keeping track of finances. As soon as college students get on campus they have a freedom they have never had before. What they also have is more important paperwork being thrown at them than ever before. College students have trouble keeping track of all of this paperwork including monthly bills, loans, financial aid, bank account statements and the effect is missing payments, late charges and missing reference paperwork for the future. When they do not have a system or a place for all of this incoming paperwork and bills, they get overwhelmed and financial mistakes get made.
Advice: Set up a system and get organized.
Tags: college, consumer, credit, economy, education, student
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