Are you or your child headed back to college? Getting finances in order to plan for the year ahead is an important part of the process. This could include changing banks, opening a new account or applying for a credit card. We have compiled six college banking moves to make before stepping foot on campus.
Research Banking Options
If you decide to find a new bank or open your own account for the first time, there are some things you should think about, including:
- How you will use the account. Do you just need a simple checking account, or do you also want a savings account to grow your money? Figure out exactly what you’re looking to do with your money and then you can decide what kind of account works for you.
- How you will move money in and out of your account. If you plan to transfer money back and forth between you and your parents, consider an account that that has zero transfer fees.
- The banking products and services you need. Online banking access, through mobile and desktop, is important and something that college students should look for in a bank. Young bankers should also look for a bank that reimburses or partly covers ATM surcharges and provides overdraft protection.
- Whether your parent or guardian will have access to the account. This is a necessary conversation to have, especially if you are transferring from an account set up by your parents to one set up by you. Having a parent on the account can be helpful should they need to quickly transfer money.
Create a Budget
College tuition is already expensive but things can get out of hand quickly when you tack on school supplies, food and extracurricular activities. Start with any monthly bills like rent or utilities and then work in other necessities like food and travel. Finally, factor in fun things like concerts, going out to eat and other activities. Figuring out how much you can spend each month will help you get in the habit of having a budget as well as potentially save you from begging mom and dad for more money mid-semester.
Learn about Overdrafts
Overdraft fees can make a small purchase turn into a very expensive venture. Some banks have fees related to overdrawing on your checking account and some also have a minimum amount you need to keep in your savings. Some banks will waive overdrafts fees a certain number of times or offer the option to not allow your account to overdraw, so your card would be declined to avoid the fee.
Explore Credit Cards
In irresponsible hands, credit cards can be a dangerous thing, but building credit while you are still in college can help after graduation. There are a few good options to consider for a first-time credit cardholder:
- Looking into secured credit cards. These cards are perfect for a student looking to build credit who isn’t ready for the full responsibility of an unsecured card. If approved for a card, you will be asked to place a deposit down, which is kept in a savings account that can’t be touched until the card is closed.
- Become an authorized user on a parent or family member’s card. Depending on the credit card, this could help you build credit if reported to the three credit bureaus. This does require a fair amount of trust on the part of the cardholder.
- Research student credit cards. Many of these cards have less stringent income and credit requirements. However, these may come with much higher interest fees so be sure to do your research.
Start Building Savings
It may be difficult to save money while in college, but if you can put away a little each month by working while in school, it will greatly help you, in the long run, should any emergencies arise. Consider splitting your deposit into two, some going into checking and some going into savings every month.
Use Student Discounts
You can also try to build your savings by taking advantage of student discounts. Be a savvy shopper and flash that student ID or use your student email for your login whenever you can. There are more opportunities than you may realize to utilize your status as a student to get a discount.
We Can Help
With flexible savings and checking accounts, online banking and bill pay and our mobile app, we have all the features a college student needs in a bank, including conveniently located branches and ATMs across Central Massachusetts. Contact us to learn how we can make banking easy for you.