<p>I am surprised at how clueless my 20 yr old son is regarding his bank accounts. He has been given the password for his online banking but never checks his balance. He can’t seem to remember that though the debit card says Visa on the label it is not the same as a credit card. The hard part is that he will not use his debit card for several months at a time but all of a sudden have quite a few charges and before anyone is aware he is down to almost zero balance. I try to go online about once a month to check the balance. He has a separate savings account at the credit union where he has money from childhood and money from his summer jobs. He has never once asked the balance. He is not a spender.
The wierd thing is as a child he was very aware of his cash. He knew exactly how much money he had and could tell you if someone (Mom usually) has borrowed a few dollars. He also was constantly trying to sell someone something. We always figured he would be the child with good money sense. I think the difference is that when he was in Middle School and the first few years of HS he was heavily into biking and was constantly wanting to buy and upgrade components. Now he has nothing he needs to buy. He also used to be heavily into playing poker with friends for cash.
Since he lives in University owned housing we pay his apartment rent by the semester so he has not learned the skills of having to pay rent,utilities etc.
Both my girls are spenders but they are very aware of budgeting their money. My older D is not working right now so has made the decision to not even have her credit card in her possession. She is a firm believer in not buying anything she can’t afford to pay for.</p>
<p>DS has a credit card and checks from our local bank. I can deposit money into his local account in minutes. I also tuck “surprise” money (in the form of checks) into the cards I send him. He really seems to like getting mail and the money is an added bonus.</p>
<p>When my kids were 16 and started driving, I moved them to a “clothing allowance” once a month and they began paying for, with a small number of exceptions, everything. We went to Wells Fargo and opened up two accounts, one of which I paid monthly via my online banking system (different bank which didn’t offer this set up). The other one we called the ‘family account’–both have debit cards so when my kids stopped at the market for me or did other errands, they used the family account; otherwise, they used their personal account. I put money into the family account as needed and I have online access to it, should I ever wish to confirm what’s been spent or the balance.</p>
<p>When D1 went to school across the country, there was one regional bank that was on campus. We had to close the Wells Fargo accounts and opened two accounts at the regional bank similar to what she had. I still treat D1’s allowance like a bill and ‘pay’ her once a month from my online account. The family account is added to as needed and is used for items I’ve agreed to pay for (i.e., textbooks). D is home for the summer but she’ll apply for a credit card with a low limit to start establishing credit in her name but, really, for that purpose rather than buying expensive items.</p>
<p>aggering,
"MiamiDap, that is what I was thinking too. Where do you get the credit cards with the preset limits by parents for 18 year olds? "</p>
<p>-Credit Union.</p>
<p>My son insists that my name remains on all his bank accounts (he is entering his second year of college). For him, it’s security. If he needs me to transfer money to him, he can call me. We also have him on a credit card, but he does not use it without calling first and telling me what he is spending. So far, it has been just for plane reservations.</p>
<p>Thank you MiamiDap.</p>
<p>My college aged kids each have checking accounts, for which I am the joint owner on the account. I told them both I would stay on it till they were 21 or graduated from college. They have set up other accounts that I am not on through their local credit unions, as well.</p>
<p>Their checking is linked to my bank account online - I can check balances or add money if they need it at a moment’s notice. I try to not ask them about purchases they make with their debit cards associated on the account. If there are any big charges or fraud possibility (like I experienced) I give them the heads up.</p>
<p>With my S travelling overseas this summer, it is helpful to have that ability to get him money in a hurry, if needed. He can’t monitor the bank accounts from the internet cafes he goes to, so it’s safer for me to check, as well.</p>
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<p>This set up has worked for us also. Since I also bank at B of A, I can transfer $ online into their accounts. We’ve been lucky in that B of A has had an ATM machine close to both of the kids’ campuses. </p>
<p>But judging from their bank statements, they either use their debit card or credit card to buy things. A rare check written (RARE!!) and few cash withdrawals.</p>
<p>momreads,
We have our D. completely separate. She has her account, credit card and her car has been switched to her name, she owns it. I feel more secure this way, but I do not know why.</p>
<p>Both of my kids have checking accounts at the same bank we do, Bank of America.</p>
<p>My son got his checking acct when he was 18 and it’s separate from ours. But I was able to link to it just to tranfer money into it - I can’t see his balance, but online I can transfer money from our account to his. Just before traveling abroad we also ot him a Bank of America VISA that I am the co-signer on, so that shows up in my online accounts. Now that he’s home, if he buys something that I am willing to pay for (example - car repair) he goes to the shop and pays with his VISA, then I go online and transfer money from our checking into the VISA to pay him back for it.</p>
<p>D got her checking account at 16, so I had to sign with her and her accounts are linked to ours. She had an allowance this year (she was still in hs) and I actually set up an automatic transfer - her allowance was transferred from our checking account to hers every Monday. She will spend money in her hand like it’s water, but hates to go to the ATM and make a withdrawal, so I think she actually spent less money this way.</p>
<p>We use Paypal. Very convenient.</p>
<p>Just called Chase. They said the interest rate can be up to 29%. Thank you but no thanks! Next on the list is USAA and Credit Unions.</p>
<p>I am a BIG fan of USAA. Another plus; you can scan checks for deposit.</p>
<p>Rice has Chase ATMs on campus. There’s a Chase branch about three blocks from my office. It’s a no-brainer.</p>
<p>Watch out for debit cards. I thought they are limited. Found out the hard way that they aren’t.</p>
<p>D’s summer earnings go into a checking account at a bank at home and are accessed via debit card for expenses she is expected to cover (e.g., entertainment, non-meal plan food, non-necessity purchases). Any money she makes while at school (babysitting and such) goes into her pocket for the same purposes. She has a low limit credit card to use for expenses we cover (e.g., prescriptions, travel home, textbooks); the bill comes home and I pay it. We split the cost of her subway card because she uses it for both “business” and pleasure, and I put our share back into her checking account when I see it pop up on her statement. Things have gotten muddled a few times, with my having to refresh her checking account when she used a debit card by mistake or because she had reached her credit card’s limit (that limit should increase soon per its terms), but in general this system is working (subject to occasional heated negotiations over what is a “necessity”). I once had to send funds to S via Western Union and it was a bit of a pain for both of us plus costly–not a method I’d want to rely on.</p>
<p>I recommend setting the terms of a student’s debit card to bar overdrafts–so if there are insufficient finds available, the transaction will just not go through. Beware the default setting that is meant allow unlimited overdrafts and earn big fees for the bank. Especially important if your kid is the not type to check balances periodically.</p>
<p>aggiering,
But if you pay off balance every month, you pay no interest. It does not matter what interest rate, let it be 100%, you will pay no dime in interest. I have no idea what interest rate on any of our cards, we just pay off balalnce every month and do not use the once that charge interest from the time of purchase.</p>
<p>Totally with MiamiDAP. The larger interest the BETTER imho to teach the kid NOT to carry a balance. Just buy what you can afford.</p>
<p>Cards with higher interest rates use the interest paid by customers that carry balances to subsidize those that pay on time every month. The card companies have a derogatory term for people that pay on time every month.</p>
<p>Paypal works great and is free! It is somewhat slow though, and requires several days for the transfer to happen. I got a tip about it here on CC from a thread I posted on the Parents Cafe. You need to set up both Paypal accounts to work with a bank account, rather than a credit card.</p>
<p>BofA allows you set up electronic transfers from other banks, but charges $3 per transfer.</p>
<p>BCEagle91,
Please, explain: "The card companies have a derogatory term for people that pay on time every month. "</p>