<p>Sweetdreams87 asked where "fun money" comes from if a student doesn't work. I can only answer for our family; our children received allowances until they began college. From that allowance 50% had to be put into their "college fund" (a savings account) which, it turned out (they didn't know) would become "fun money" while in college. They also had a "fun money" savings account that they deposited any gift money into if the chose not to spend it. </p>
<p>Our kids were so busy during high school they had very little time to have jobs. Our older S had a bit of work with his grandfather in the summer (my dad was a house painter in the summers), but our D basically saved her allowance and gift money. She now has a part time job on campus and saves a percentage of that money and the rest is for her to spend as she wishes. (We had agreed when we had children that we would pay completely for their undergrad education. I realize that not all parents can/will do this.) </p>
<p>Side note: Guess I'll have to read the posts on how to quote previous posts. I've not had time to go through old posts and see how to do that yet. It's kind of nice to be back, but I must confess it is also a bit depressing; the whole College Stress Thing makes me sad. Sigh. (It's great to see so many familiar names here, though!)</p>
<p>Our son set up a checking account with and ATM card with an on campus bank. That is very convenient for him. He also has had been issued a credit card in his name on one of our credit cards since high school. He can only use it for gas and emergencies and has been very good at abiding by those rules.</p>
<p>The reason we did the credit card thing is that Suzie Ormand(?) mentioned that this would develop a credit rating for him and since we typically pay it off every month we thought this would be good for him a few years down the road.</p>
<p>I'm repeating what I said on page 1, but really, if your kids work and can set up an IRA as mine did (they also set up SEP funds, since they also have their own small businesses, working as independent contractors), they should. My kids took one look at those programs that show that if you put away the exact same amount of money from age 16 to 21 (or 24 or something), then stop FOREVER, you will have MORE money than if you put that amount away starting at 25 until you retire! Or something like that - due to the miracle of compound interest and/or dollar cost averaging.</p>
<p>One of my kids does far, far better than me or his dad in managing his portfolio. Also better than any index funds. If stocks are too scary, there are plenty of less risky places to put money. Even if it is only $50 a month. They will thank you later!</p>
<p>Originaloog, we did the same as you for the credit card and for the same reason, although our kids have always paid us back for paying off the cards. Now the older ones have GREAT credit rating; FICO scores between 750-850 (ha ha - it's not only SAT numbers they have to worry about! :) )</p>
<p>Yes, S also has a retirement account (Roth IRA). He has been good about "banking" most of his summer earnings during HS and, with H's guidance, opened a Roth IRA after jr. year summer, to which he contributed the max.</p>
<p>Not sure, but isn't this also good because retirement accounts are not looked at in calculating EFC? Esp. beneficial on student accounts, as 35% of their assets are counted?</p>
<p>
[quote]
Our son ...has been issued a credit card in his name on one of our credit cards since high school. ...Suzie Ormand(?) mentioned that this would develop a credit rating for him
[/quote]
Is this really true if card is on parent's account #? Our S has also had VISA in his own name since early teen's, but I didn't think it would affect his credit rating as not a separate acct #. He now (age 18) has AX in his own name on our account (with last 3-digits different, but same master account). Does this give them their own credit rating?</p>
<p>As far as building a credit rating, it really depends. If it is simply an "additional card" (for example, I have an additional card with my bf's name on it--he can sign) it doesn't show up on their credit reports. If it is a "joint account" then it can (but doesn't always) show up on their credit reports.</p>
<p>I would suggest checking their credit reports to know for certain.</p>
<p>We will be paying our sons' tuition, room and board; expecting them to work for books and spending money. I have wondered if it would make sense for them to fund Roth IRAs and borrow their spending and book money. (It seems unlikely they'll make enought $ for both.) I'd like them to have some financial stake in their education.</p>
<p>jmmom - typically cc companies report on "Authorized Users" as well as the main account holders - so any "authorized user" like your s will benefit from your payment history on that account...
FYI if you know any credit challenged folks out there...being added as an Authorized User is a good way to start re-building your credit after a BK or any other credit issues.</p>
<p>We promised our 2 kids that whatever earned income they had during high school and college would be theirs to apply toward expenses not covered by scholarship and our payment of rest of R&B/tuition/books (or fun $$ as others have called it). We would not provide an allowance. In exchange, we agreed that we would contribute the amount of their earned income to their Roth IRA's to give them a head start on their retirement funds. Our contributions will stop upon their graduations from college when they will be (hopefully) gainfully employed.</p>
<h1>1. "personal expenses." Probably on the low side. Better plan to have enough than not enough. Girls will probably need more than boys. More activities = more money.</h1>
<h1>!7. "fun stuff" money will come from money that was stuff you really "want" and if you are desperate, money that was dedicated to stuff you really "need."</h1>
<p>You can live real cheap at college. Movies will probably be sponsered from a club and will cost $1 to $3. Plays, concerts and sporting events are student rate or less. What will cost you $$ will be the {bold}amount{/bold} of snacks and cola/coffee drinks you consume out of habit when you lived at home.</p>
<p>Do not let peer pressure force you in spending more money than you can afford, especially if parents are paying. There is no shame for being poor (you should be poor, unless independently wealthy) but you should also avoid being a skinflint.</p>
<p>You just asked a philosophical question that is hard for anyone to answer and which only you can truely discover. There are alot of variables, as where you are going, how many meals are you going to eat outside of your meal plan, what you going to eat, are you going to be in a cold or hot clime, the major you will be studying, can you tolerate going without colas, coffees and in my day how long can you endure ramen noodles without getting physically sick. </p>
<p>Would you agree that there are wealthy people and not so wealthy people in your neighborhood. Have you noticed that, even the not so wealthy people still have a place to live, food, and clothing. Your standard of living will be what you want it to be.</p>
<p>A direct answer: Perhaps 20% of above the suggested amount for a modest personal expense. I'm sure that others can give you more detailed advice if you devulge your current life style and your college of choice. </p>
<p>ckr1147 -- when my son went to college, I learned that there was a Sears store about half a mile from his campus, so I added him to my Sears card, which I hardly ever use. I've had that card since I was in my 20's, long before I was married. I figured he could use it to pick up small appliances or tools for his dorm room, and basic clothing needs. He did, on occasion. </p>
<p>About a year ago he needed a credit report to rent an apartment -- the report not only came back with excellent credit -- he had a credit history that went back 30 years - long before he was born.</p>
<p>So you are right, that authorized user thing really works.</p>
<p>I think it works in reverse, too -- which is why I called all the stores & creditors after my marriage broke up to make sure that my name was NOT on any of my ex-husband's cards.</p>