FINANCIAL TIPS

Jean says: There are college expenses you plan for – food on the meal plan, books – and then there’s everything else. Laundry, late night pizza and other extras add up fast. Decide how much your teen will have for these variables, tell them to track all spending, then check back in a month to see how it’s working out.

Stacy adds: And encourage young adults to show off the organizational skills they’ll pick up at college with additional record-keeping measures. Introduce them to systems for filing and keeping track of monthly bank account, debit, charge and credit card statements, plus leverage the free online account management tools card companies and banks provide.

Jean says: Under the CARD act, your teens can’t qualify for credit cards until age 21 or they have an income to back it up. But you can add them to a card of yours as an authorized user. Make sure the card company will establish a reasonable credit limit for their card and that they report the history of bill payment to the credit bureaus under your young adult’s name, as well as yours. As long as you pay on time, your teen can come out of college with a good credit history in the works.

Stacy continues: A card linked to your account proves ideal for college students in emergency situations. Parents never know when their young adult might need immediate access to additional funds to get themselves out of a jam. For example, their car might break down off campus and they need to pay for a tow back to their dorm. You can give a college student a charge card like the American Express® Additional Card with Custom Limits™, that allows you to quickly and easily raise their spending limit – granting them access to additional funds – simply by going online.*

Stacy says: It happens to parents, too – paying for a killer outfit or electronic gadget with a credit or charge card, only to feel the delayed sticker shock at month’s end. Before your college student arrives on campus, talk about the types of spending temptations they may experience and should avoid while at school.

Jean adds: Your teen won’t be on campus for a week when they’re tipped off by a classmate that, “Hey, you can charge whatever you want at the bookstore – sweatshirts, MP3 players, and computers – and put it on your bursar bill.” Keep your eyes open for this and other financial slights of hand and make them pay the bill. If you don’t notice the first time, they’ll do it again and again.

Jean says: Your college student needs an account at the bank with the most ATMs on campus and they need to use their bank’s machines exclusively. Straying can cost $3 or more a pop.

Stacy adds: Explain to your young adults, however, that one of the times when they should stray from their bank (and debit card) is when shopping online. Remind them that like with their updates to social media accounts, repercussions may rest behind every click when making online purchases. Encourage them to use online shopping protection in the form of a credit or charge card – rather than a debit card – since cards can come with protections against fraudulent charges, merchant disputes, and can help if something purchased is damaged or stolen.

Stacy says: Get to know your teen’s spending and savings tendencies, and use this insight to help them develop a customized smart spending plan that can carry them through college and beyond.

Jean continues: And be sure to include college contributions in your teen’s or young adult’s smart spending plan, even if you’re paying for college. Whether they kick in towards spending money, books or actual tuition, they’ll value the experience more if they have some skin in the game. And it won’t compromise their education to let them work to do it.

Jean Chatzky is an award winning personal finance expert and bestselling author. Jean's just published title, NOT YOUR PARENTS' MONEY BOOK: Making, Saving and Spending Your OWN Money, addresses exactly what kids want and need to know about money. Other recent books from Jean include: MONEY 911, PAY IT DOWN!, THE DIFFERENCE and MAKE MONEY NOT EXCUSES. Jean appears on television is a columnist for the NY Daily News and her articles have appeared in publications including USA WEEKEND, TIME and MONEY. Jean lives in Westchester County, New York with her husband and two children, and is a passionate advocate for financial literacy who believes every child should learn about money both in school and at home. Learn more about Jean at www.jeanchatzky.com.

Stacy DeBroff is a nationally-acclaimed parenting expert, best-selling author, and founder and CEO of Mom Central Consulting – an online resource dedicated to providing busy moms with smart household and parenting solutions explains (www.momcentral.com). Stacy also founded Mom Central Consulting, a marketing consulting firm, working with Moms and brands. Learn more about Stacy at www.momcentralconsulting.com.

* When you request that we apply a limit as described below on Charges incurred by an Additional Cardmember on your Account, you agree to these terms. These terms supplement, and are incorporated by reference into, the terms of your Cardmember Agreement. At your request, we may agree to apply a limit to the total dollar amount of Purchases, during each billing period, that are charged to Card numbers associated with one or more specified Additional Cardmembers on your Account. At your request, we may agree to apply a limit to the total dollar amount of cash access transactions at ATMs and American Express Travel Service locations, during each billing period, that are made using Card numbers associated with one or more specified Additional Cardmembers on your Account. If we agree to apply a limit, it is not a guarantee that the Additional Cardmember will be able to make Purchases or cash access transactions up to the applicable limit. In applying any limit we will not take in to account any credits (such as for returned merchandise or for payments), even if a credit relates to a Purchase made by the Additional Cardmember. Any request that we change a limit may not be effective until a subsequent billing period. Any Charges (as defined below) incurred by the Additional Cardmember prior to the date during a billing period that we apply the limit will not be subject to the limit for that billing period. Because of systems or administrative considerations, arrangements with merchants, or for other business reasons, we may, but are not required to, treat some Purchases and/or cash access transactions (collectively, Charges) as not being subject to any such limits. You agree to pay all Charges without regard to whether any Charges exceed a limit, and you agree that we are not liable to you or any other person when a limit is not applied to any Charges and/or when Charges are incurred and billed that exceed a limit. While we typically require merchants to obtain an authorization for purchases and submit final transaction documentation for payment in a timely manner, a limit may not apply or may be exceeded when a merchant does not obtain an authorization for any reason; when a merchant obtains an authorization for a partial amount of the final charge submitted to us for payment; or when such submissions are not submitted or processed at the same time that the authorization is obtained. Examples may include, but are not limited to: Charges made outside of the U.S., in duty-free stores, or on board airplanes or cruise vessels; international airline ticket Purchases; vehicle rentals; lodging stays extended beyond original reservation period; certain mail order Purchases; Purchases billed on a recurring basis; Purchases at gas stations; telecommunications charges, including charges incurred with calling cards; taxicab charges; security deposits; late, damage or other fees in connection with rentals; Purchases billed in installments; restaurant tips and other gratuities; and Charges that occur before the end of billing period, if the Charge is posted to your Account after the Closing Date of that billing period. Any limit will not be applied to Charges for foreign currency or for travelers cheques or gift cheques obtained at a location other than an American Express Travel Service location or by telephone from us.