I remember when I first went to college. My mother and father drove me up to the campus. We unpacked and my mother spent the afternoon setting me up--arranging my underwear drawer, putting pads and pens on the desk, lining shoes up in the closest. She was a master at organization.

My father and I went to the only bank in town where he opened a checking account for me. There were no names on these checks. Simple gray colored paper with the bank's name and my account number. My father would send me a check each month that I would then deposit in the account and draw from that for my monthly expenses. The regular tuition and room and board bills went directly to my father, as did my monthly bank statement so he could see what I was doing.

I didn't have very much money in the account and my father told me that if I needed any more money, I had better get a job to supplement my income. I did. I was forced to plan.

Let's fast forward to today's world. The kids heading off to college now have no idea what financial planning is. Of course, one could say this is nothing new. It took place even back in my time. I'm not so sure about that that. In today's very tight economic climate, budgeting has become of paramount importance and I don't think the kids of today really know from budgeting.

A survey this past July by Nellie Mae, the student-loan agency, shows that 83 percent of college students had credit cards last year, up from 67 percent in 1997. Think of that. Credit cards! 83 percent! And more than 27 percent of students had balances on those cards that exceeded $3,000, up from 22 percent the previous year. Doesn't this tell you something?

When my cash supply ended at school, so did I. Not today. If students want to go beyond their means, well they just whip out that piece of plastic.

So, what to do? For one, before you pack your kids off to college, sit down with them and give them some basic financial guidelines. Also, even if you missed the boat and your offspring are now on campus, direct them to the financial aid officer or they can get information from a campus credit union.

I noted in one newswire recently that financial awareness among young people is rapidly going the wrong way and that according to Jumpstart Coalition for Personal Financial Literacy, 12th graders scored 50.3 percent on a financial literacy test this year. That's a failing mark, folks!

Is it an understatement to say that the weak economy has given rise to a need for financial guidance? Yup!

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access