February 15, 2013
Today’s teenagers are all about apps. They live and breathe by their electronic devices. They use apps for everything from taking pictures to playing games with friends. Parents can use this addiction to their advantage when it comes to money and spending habits, especially when the teenager leaves home for college.
Here are just a few apps and features that might help your student thrive while keeping budgets in line.
All the major banks, and many of the smaller ones, now offer apps that allow you to deposit checks remotely, check account balances, pay bills and see your transaction history at the push of a button. No more writing paper checks and reconciling the bank statement.
Do advise your student, though, that bills paid by check, debit card transactions marked as “authorized” and some other transactions don’t show up in the bank account in real time. If your student looks at her bank account balance, she must keep in mind payments that are currently in transit and deposits that are being held. Otherwise, she’ll end up overdrawing the account.
Check your bank’s website to learn about the specific apps available and how they work.
If you hold a joint account with your student, you can receive text alerts when the student spends money from the account. You can set most systems to fit your needs, from knowing every transaction to knowing only transactions of a certain size. You can also receive alerts if the account balance falls below a certain amount. Again, check your bank’s website for specific information.
Budgeting Apps such as “Mint” and “Easy Money” can help your student keep up with what he is spending on various categories of products and services and compare that spending to a predetermined budget amount. The student might be surprised at just how much he spends each month on coffee, pizza and the like. The data these apps provide can also be good conversation starters for parents when spending is getting out of hand or when trying to budget for the next college session.
Technology has made handling money more convenient in many ways, but the convenience has sometimes resulted in less self-control. Swiping a debit or credit card or flashing a mobile check can make it seem that there is an endless supply of money – at least, until the statement comes in. The ease of electronic spending makes it more necessary to have technology that limits spending or reminds the student that there is a piper to be paid at the end of the period.
Money management needs to be one of the lessons college students learn at this point in their lives. Apps don’t take the place of the good old-fashioned “talk” that parents need to have with their children about responsibility and the value of money.
The apps can, though, help reinforce the message and keep unfortunate surprises from resulting in penalties, fees or compromised credit ratings.
Talk to your children. Set appropriate limits. Then evaluate the tools that are available for the devices they have.
This article was originally posted on February 15, 2013 and the information may no longer be current. For questions, please contact GRF CPAs & Advisors at firstname.lastname@example.org.