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Ask the Experts

Ask The Experts

Q:
Son needs to learn to control expenses without losing control

My son is going off to college next month for his first semester. How do you recommend he handle his expenses, credit card, debt card, and checking account? He needs to learn how to control expenses without getting out of control. -Emily

Dear Emily,

This is the perfect opportunity to start your son's higher education. Before you do anything, sit down with your son. Talk to him about your expectations and make sure that you are on the same page. Make sure that he knows the value of good credit and the ramifications of being in debt. If you have not already done so, show him a sample spending plan and discuss successful money management techniques. Once all of this is established, you can start to talk about a credit or debit card.

The benefit of your son obtaining a debit card versus a credit card is that he must have the money in an account before he can make a purchase. This makes the very popular debit card less risky. If you choose this route, you son will have to open his own checking account and needs to understand that keeping accurate records is imperative. "Bounced" checks and overdraft charges can be costly.

On the other hand, a secured card credit or a card with a low limit, might help your son establish good credit habits and a good credit history. The risks are obvious, so please be sure that your son is ready for this level of responsibility. In addition, if you plan to co-sign for his account, please know that you re basically responsible for the debt. This means if your son does not pay his bills, you are responsible. If he makes late payments, your credit report suffers. And these examples are only the tip of the iceberg.

With a little communication and planning, I am sure your son will do just fine. I applaud your involvement and wish you both the best.

The Advice Team