College student spending of mom and dad's money

[Anonymous]

My dd's bank account was linked to mine when she opened it as a minor, and we have kept it that way through college. She has her own debit/credit card but does not have access to our account. I can transfer money into her account if needed for agreed on expenses. No reason for a college age kid to have open season access to your bank acct for their Chipotle habit, but it is useful to be able to transfer funds when that is part of your financial arrangement with them for rent, groceries or whatever spending money limits you set.

[Anonymous]

Anonymous wrote:My daughter has her own bank account, a fixed allowance during term time, and if she wants money for the summer she can earn it. I don’t understand all these people that give their kids their credit cards. How are they meant to learn the value of money?

I don’t make them put all their money in a Roth though, that is bonkers.

Actually - the Roth is a very smart idea. The credit card help to build a young adults credit score.

[Anonymous]

Definitely set a budget or allowance. Essential life skill to budget for the week or month.

My kid was never allowed to just hang out in the summer. She had internships every year so earned spending money.

I’m not sure why you’d let a kid off the hook in such a big way. Even a PT job or volunteering would be good.

[Anonymous]

We cover 100% of all costs - food, apartment, socializing, eating out, uber eats, vacation, transportation, clothes, electronics etc - for our college student. They earn internship money during summer and they put it in their Roth and investments. They like to see their savings and investments grow. They have become frugal with their own money.

They have access to our Amazon account, our checking account, google pay, uber, starbucks, kohls, costco, macy's, REI.

We see immense value in this set-up because we have a fair idea of where he is spending and on what. They never got allowances when they were little and we paid for everything. And we always kept the generous cash gifts that were given to them by relatives and friends. They were given 20K seed money when they started college, which they have invested.

They won merit scholarship of 100% tuition+ for college. So, they will be given a new car when they graduate + we will help with all the stuff they need for apartment, rental deposit, professional wardrobe etc.

[Anonymous]

You can't unspoil milk.

[Anonymous]

I had my own credit card in college, my parents didn't see the bill, I never carried over a balance. I paid for any fun stuff and extras through my part time jobs, tour guide shifts, and babysitting. Sometimes I did psych and business studies for the cash.

[Anonymous]

Anonymous wrote:My dd's bank account was linked to mine when she opened it as a minor, and we have kept it that way through college. She has her own debit/credit card but does not have access to our account. I can transfer money into her account if needed for agreed on expenses. No reason for a college age kid to have open season access to your bank acct for their Chipotle habit, but it is useful to be able to transfer funds when that is part of your financial arrangement with them for rent, groceries or whatever spending money limits you set.

This is what we did, but in your defense OP, we found the hs to college transition and money management tricky with our oldest kid. He’s 20 and he just opened his own checking account that we can no longer see and got his own credit card with a small limit. We’ve kept the shared checking account to transfer money into as needed, but we’re trying to teach him more about budgeting. Oh, and they work and will work year round starting this coming school year.

[Anonymous]

I think by this age it's best if they have their own low-limit credit card that they are responsible for paying, or just use a debit card. If you want to give them spending money then use Zelle and do a monthly transfer.
It's still good for them to have a parent card for emergencies or pre-approved expenses (like getting gas for the family car or picking up family groceries.) But they shouldn't use it regularly.

[Anonymous]

Our three had jobs and we never shared a credit card with them. If you don’t stop now you’ll be subsidizing her for years to come after she graduates.

[Anonymous]

Are you kidding, OP? Goodness.

Your kid should get a job.

I have two teens: one in college. Both have had jobs since they were 16.

We don't give them our cc. They got their own. 19 yr old DC is super proud of their 750 credit score they built up on their own.

You are not teaching your kids to be independent adults.

[Anonymous]

Our kids had debit cards tied to their bank account. When they were away at school we put money into their account for school related expenses. On breaks they were expected to work and cover their own social lives and activities. Even at school we didn’t fund their social lives, just the expenses of being a student.

[Anonymous]

Needs to have a job this summer period and while at school. Deposit a set amount into her bank account every month and that is all she gets per month. We cover tuition, car payment, insurance, apartment. She pays for her own food and utilities. When times are hard and she is unable to work much due to school work, we cover utilities.

[Anonymous]

Anonymous wrote:We don’t pay for takeout for our kids unless we are all eating together and we offer to treat them. How have you not addressed this before? My kids knew this in HS and would have lost credit card access if they abused it.

Offering to treat your own kids. How thoughtful of you.

[Anonymous]

Anonymous wrote:We cover 100% of all costs - food, apartment, socializing, eating out, uber eats, vacation, transportation, clothes, electronics etc - for our college student. They earn internship money during summer and they put it in their Roth and investments. They like to see their savings and investments grow. They have become frugal with their own money.

They have access to our Amazon account, our checking account, google pay, uber, starbucks, kohls, costco, macy's, REI.

We see immense value in this set-up because we have a fair idea of where he is spending and on what. They never got allowances when they were little and we paid for everything. And we always kept the generous cash gifts that were given to them by relatives and friends. They were given 20K seed money when they started college, which they have invested.

They won merit scholarship of 100% tuition+ for college. So, they will be given a new car when they graduate + we will help with all the stuff they need for apartment, rental deposit, professional wardrobe etc.

I would like to add that this only works for kids who are very motivated, balanced, informed, careful and frugal by nature. They should get introduced to personal finance management much before they reach college. Your kids need to value money without being greedy. False deprivation or abundance without discernment - both will skew how your kids view money. They should view money as a powerful tool to reach healthy and positive goals in life.

Your kids also need to willingly choose the path to increasing their wealth at a young age and have the kind of relationship where they view the parents as a partner in their initial financial success. At the same time, they need to have a clear idea of what this wealth/prosperity gives them. You know your kid best.

Much also depends on the company they keep. If they are hanging out with kids who are big spenders and your kids value that, then their relationship with money is a means for just consumption and instant gratification. You don't want them to have access to your bank account then.

I abhor the idea of giving allowance to kids without supervision. It teaches them nothing. The kids then think it is ok to spend all of their money on candy or video games etc. Parents also think that after they have given their children some $, they don't have to educate them in how to spend their money, how to budget, how to evaluate the returns, how to grow their money.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We don’t pay for takeout for our kids unless we are all eating together and we offer to treat them. How have you not addressed this before? My kids knew this in HS and would have lost credit card access if they abused it.

Offering to treat your own kids. How thoughtful of you.

+ 1
This was a very hostile and controlling tone. I guess that is how your kids leave the house at 18.