If you’re preparing to send a child off to college, things are different this year. Normally you’d be scrambling to gather all the components needed to ensure your student’s social and academic success in college, and you’re probably still doing some of that. However, the difference this year is that some students may be attending college remotely, rather than on campus.

Regardless of how this coming semester plays out on college campuses, you still need to prepare your student for the rigors and demands of college, including finances. If you’re trying to figure out what you can do to help your college freshman get financially ready for school, there are seven critical topics to discuss.

1. Carefully Consider a Student Credit Card

a young woman contemplates an online credit card purchase

A student credit card is a convenient way for your student to pay for financial necessities and emergencies that arise in college. While they aren’t for everyone, student credit cards can be a valuable credit-building tool for working students who have some experience paying their own bills. If that doesn’t sound familiar, you can also consider adding your student as an authorized user on your credit card or helping your teenager set up a checking account.

What You Should Know About Student Credit Cards

Student credit cards differ from regular credit cards because they are designed for working college students who have never used a credit card before. Some student credit cards offer cash-back rewards for good grades, and they tend not to have annual fees.

If your child is denied a student credit card, use that denial as a teaching opportunity. “If the child is denied, parents can teach the child about obtaining a secured credit card to start. Cards like the Discover It Secured Card will transition to an unsecured card with good usage over time,” says Ryan Decker, director of the Center for Financial Literacy at North Central College, in Naperville, Illinois, and assistant professor of economics and finance.

“Encouraging the use of a credit card early will allow the student to obtain a quality credit score for the car purchase, home purchase or student loan refinancing that typically happens after college,” says Decker. “Teach the child to use the credit card for small purchases and pay it off in full every month. Treat the credit card like a debit card, and you’ll never be in credit card trouble.”

Decker says that not every first-year college student should have a credit card. “Credit cards are not for everyone,” Decker says. “If having a credit card will lead to debt or poor, unhealthy behaviors, the individual should not obtain a credit card.”

Not yet, anyway. It won’t hurt students to wait until they graduate to get a credit card. It will hurt them, or at least their credit, if they get a credit card now, max out the limit and forget to make payments on time.

Amy Maliga, a financial educator at Take Charge America, a nonprofit credit counseling agency, has some advice for all parents whose college freshmen are bringing a credit card to college: “It’s imperative to discuss the potential pitfalls of credit cards and that how students manage this first credit card can affect their credit for years to come.”

What You Should Know About Authorized Users on Your Credit Card

A young male college student orders an item online with a credit card

For students who aren’t quite ready to have a credit card in their own name, they can be added as an authorized user on their parents' credit card.

The upside is that your student won’t go deep into debt and abuse a credit card without your knowledge. The downside is that your finances will be impacted if your student decides to go on a spending spree. If your college freshman spends $500 on a ticket to Cabo for spring break with your credit card, you’re responsible for those charges, because you authorized your child to use your card.

What You Should Know About Your Teenager Getting a Bank Account

First-year students heading off to college should have a bank account. They need access to money, whether they earn it themselves or you give them an allowance. You could, with your teenager’s knowledge, make it so that both your accounts are connected. You’d see what your teenager is spending money on, but they can’t see what’s happening in your account.

As you may know, if you’re not skilled with money yet, you can do a lot of damage to a checking account with overdraft fees. If you’re able to see your student’s account, you’ll get a notice when the balance drops below an amount you specify. You’re also able to easily transfer an allowance into your student’s account from your account.

2. Take a Look at Your Auto Insurance

A college student drives her car to her college campus

If your child is on your car insurance policy and will be driving while in college within your state, you don’t need to do anything. If the car will be driven out-of-state, let your insurance provider know. It may not matter, but you should still inform them. However, if your teenager won’t be taking a car to college and will only be driving when at home during breaks, you may get a lower rate, especially if the university is over 100 miles away. Check out our entire rundown of whether your freshman needs car insurance to learn more about “student away at college discounts” and other ways to save.

If your student is taking a car to campus, you’ll need to budget for expenses such as a parking pass and gas.

3. Make a Plan for Health Care

A young female college student calls her mom to tell her she's sick

Ensuring that your child can receive treatment and medication under your health care insurance plan while away at school requires planning and a clear understanding of your policy. Healthy first-year college students still need to know where to go and what to do if they don’t feel well and need to see a doctor.

“If students are covered under a parent’s plan, they need to make sure they have their insurance card with them on campus,” Maliga advises. “If a parent’s plan doesn’t cover them, many colleges and universities offer medical insurance plans that are either funded directly by the school or through an outside insurance company. Lower-income students should also investigate their options related to Medicaid or purchasing coverage through the marketplace at Healthcare.gov.”

Whether your child is on your [health insurance plan](https://www.moneygeek.com/insurance/health/) or has a student health insurance plan, you will want to determine how access to those medications will occur. If your teenager sees a therapist, you may want to continue doing that through telehealth visits or look into what mental health options the school has available through student health services. Students can usually access student health services for free or a very low cost per visit. Some schools even have an on-campus pharmacy available which offers low-cost prescriptions to their students.

4. Look Into Renters Insurance

A young male college student does homework in his apartment

Your college-bound child may not need renters insurance if headed to a dorm this fall. You should check your policy, but your homeowner’s or renters insurance will often cover your child’s belongings in a dorm. If your student lives in an apartment, you should strongly consider getting a renters insurance policy. While it’s not a necessity like homeowners or auto insurance, some property managers require it. If your student has a laptop and basic belongings, it’s usually a smart purchase.

While it’s yet another college expense, renters insurance is usually relatively affordable. According to the Insurance Information Institute, the average cost of renters insurance in the United States was $180 a year in 2017.

5. Learn the Difference Between Scholarships, Loans and Grants

A female first-year college students works on homework in her dorm room

Perhaps the best financial move you can make when sending your child off to college is checking out scholarship websites such as Scholarships.com, FastWeb.com and Cappex.

Decker stresses the importance of scholarships. “Parents should continue to push for the child to apply for scholarships. There is money out there. A simple Google search will lead to databases of scholarships for every student profile,” Decker says.

You’ll also want to look into grants, which are typically need-based versus merit-based. The federal government offers grants, including the Federal Pell Grant.

The bottom line is that grants and scholarships are free money. You don’t need to pay that money back.

What You Should Know About Federal Student Aid

A college student is deep in thought as he works on his computer

Tyler Henson, director of MT One Stop, the registration and financial services office at Middle Tennessee State University in Murfreesboro, Tennessee, says that financial aid, including student loans, won’t be much different this year than it has been in past years.

“The federal government has not increased need-based aid or loan options through the Department of Education in light of the pandemic. Most funding providing higher education by the CARES Act went to students enrolled in the spring and summer terms,” Henson says.

But Henson does have some encouraging news for parents.

“For parents who lost their jobs and had a significant loss of income this year, they should be able to file a special conditions request with their school’s financial aid office,” Henson says. He explains this may be a way for students to secure additional federal funds.

Henson also says that students should make sure a FAFSA is on file for the 2020-2021 school year, regardless of if they plan to take out student loans or not. “When the CARES Act passed, and higher education institutions were provided with funds for students, it came with a caveat that students had to be eligible for federal aid. Students without a FAFSA on file were left out in many cases or had to scramble to submit a FAFSA late,” Henson explains. “It is always a wise idea to have a FAFSA on file each year, just in case a student does ever need a loan or something like the CARES Act comes up. Plus, many students are eligible for aid like the Pell Grant or state scholarships without even knowing it, because they didn’t do a FAFSA.”

6. Look for Deals and Discounts on Technology

a college student does schoolwork in the library with her computer in front of her

Computers and laptops are going to be more important than ever to students of all ages this fall.

“Many students will be taking classes online this fall due to the pandemic and issues surrounding it,” Henson says. “This is not an ideal scenario for some students, nor is it ideal for many institutions. Students should make sure they don’t let technology stand in the way of being successful.”

Apple offers a discount on computers to college students, and this summer is no different. Your student might qualify for an educational discount on the MacBook (up to $200 off) or iPad (up to $100 off). Apple also offers MacBook financing. If you use an Apple credit card to buy a MacBook, you can pay it off interest-free in monthly installments.

If your teenager isn’t an Apple user, you can find back-to-school offers on a variety of computers, laptops and devices.

If you can’t afford to buy a computer for your child, you may want to contact the college and ask if they can help.

“Some schools are offering students laptops, Wi-Fi cards and technology if they don’t have the means to get it themselves,” Henson says. “I know my institution, MTSU, gave out hundreds of laptops and Wi-Fi cards in the spring when students went online, so I imagine other schools will do the same this fall.”

7. Have the Money Talk With Your College Freshman

A mother talks with her teen daughter about money as she prepares to leave for college

Hopefully, during your many conversations with your kids, you’ve already talked about money. You’ll want to have a more detailed money conversation with kids heading off to college. Discuss the importance of budgeting and tracking spending, particularly if your child uses a student credit card.

While some students are lucky to graduate college debt-free, student loans are necessary for other college students. If your child falls into the latter category, you should have a frank discussion with your child about the money they will owe on those loans come graduation.

If your child has to delay moving on campus due to the coronavirus and will be attending college on a computer at home, you’ll still have plenty of time to talk about budgeting, using credit cards properly, avoiding overdraft fees and everything else you want to teach your child about finances.

Your teenager will be going off to college sooner or later, whether it’s this fall or several months from now. Take any unexpected extra time with them as a priceless gift — because the day you’re hugging them good-bye in a dorm room will be here and gone before you know it.

About the Author

Geoff Williams is a freelance writer for MoneyGeek specializing in personal finance and small business issues. He has two teenage daughters, with his oldest attending college this fall. If all goes as planned, she will be residing in a dorm.