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[quote=Anonymous][quote=Anonymous]I have a child in college who we cover all expenses for: tuition, room and board, food, clothing. The only thing we want them to pay for is their entertainment. This summer said child was supposed to save most of their earnings for spending money in school, but they have already spent about 1/2 on frivolous things. Last year I paid off their credit card when they ran out of money so they wouldn’t get hit with late fees. Their credit card is a separate card but it’s connected to our bank account so I can pay it and see the charges.

I want to take a harder line this year and not bail them out when they run out of money. What’s the best way to let this happen? Let them incur late fees? Take a hit to their credit score? I really don’t want that to happen but I also need them to learn to budget. Will their lateness on paying off their card hurt our credit score?

Suggestions, please.[/quote]

Sit down with your child to create a budget. Set an amount that they can spend per week on extras. I wouldn't allow my child to ruin their own credit score, but this kind of behavior makes it really clear that they are not using any critical thinking and/or think that the money is unlimited. It sounds like they need more regular supervision, including checking to make sure they are staying within their budget. Since you can see all the transactions, that should be fairly easy to police. You shouldn't have to do it, but they clearly need supervision given that they have blown their budget twice in the last year (once when you had to pay the bill and now having spent half their summer earnings).[/quote]

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