Teenager/Money Issue UPDATE

[TromboneAl]

This topic is an update to the Teenage/Money Issue thread of last October. I'm posting it in case it's useful to others with kids in college.

Update Summary: She's kept to her budget, but hasn't managed her money well, and recently had another series of bank overdrafts. She's made her $50 loan payments, but some of them have been late.

I thought that her overdrafts from last summer would have taught her her lesson, and she would never bounce another check again. But that was wrong. I'm now requiring her to track her money more carefully. We installed Quicken on her laptop over Christmas, and she's required to send me budget reports every month.

Her job (she works at a call center, calling alumni and soliciting donations (I know, my daughter's a telemarketer! )) has brought in about $300 per month. She's always on the edge of being totally broke.

Her attitude with the checking account was "I just use my debit card, so I don't need to reconcile." Now she's learned that that doesn't work, and I'm making sure that she reconciles regularly. She also didn't write down expenditures in a register. I'll say "What was this $16 check for?" and she'll say "I have no idea -- let me go online and view the check image -- oops, it's too old, and there's no image."

She now has a credit card that will handle overdrafts . We'll see what happens there.

THIS SUMMER

No loan this summer. I'm giving her $400 for startup expenses. She has a possible one-month internship at the Karolinska Institute in Sweden (DW's family is Swedish). Current tentative plan is that she flies to Sweden, does the internship and gets a job for the other months. This could happen because her grandparents want her to come there and would pay for the flights. She would live with them.

She knows that if she doesn't bring in some bucks from the summer, she'll be on the same austere budget as this year.

Stay tuned.

 

[simple girl]

You know what, I just don't get it. You seem like you do a great job teaching her personal financial responsibility, and yet she's had more overdrafts Makes me wonder what more you can do? You sure do have patience!

Gosh, when I was in college, I had so little money, and I made it by just fine. I mean, I didn't have a lot of money, but I never had to ask anyone for money. I guess I knew there would be no one there to bail me out. My parents loved me, but had no extra money at all. I was on my own (my Mom was great though at helping me figure out financial aid, etc.). I guess all those years walking through the grocery store with her, helping her enter the prices of the things she bought on one of those "clickers" (remember those?) really hit me hard...I never have forgotten the value of money and the feeling of security that comes from managing it well. I actually remember picking something I wanted (i.e. candy or something) and thinking about asking if we could get it...then I saw the clicker going...and put the item discreetly back on the shelf.

 

[wabmester]

Gosh, when I was in college, I had so little money, and I made it by just fine. I mean, I didn't have a lot of money, but I never had to ask anyone for money. I guess I knew there would be no one there to bail me out.

Ditto. Not having my parents pay for college was a great education for me. In fact, it was probably a bigger factor in my career success than any of my course work.

 

[haha]

I see it differently. She is in school away from home with a bunch of rich kids. She sounds like a great kid. Why go away to college if it isn't going to be fun?

My college years were one long overdraft. I couldn't get my diploma until I made good on everything.

Of course banks were much more lenient then, and fees didn't amount to anything. It took me until I was in my fifties to get serious about controlling outflows, which I now do pretty well I think.

More controlled I don't want to be.

ha

 

[lazygood4nothinbum]

most post cards from summer camp asked for money (mom saved them so now i can see how foolish i was).

most phone calls from college was asking for money.

i've recently retired on my inheritance.

live and learn.

or not.

 

[TromboneAl]

I was really ticked off about the overdrafts, and there's no excuse. However, in her defense, I think the banks now handle overdrafts as a profit center. In the old days, I seem to recall if you gave someone a check and didn't have sufficient funds, the check was returned and you were embarrassed.

Nowadays, the bank charges you $35 (and covers the check??). Anyway, her balance got negative, and six overdraft charges came in over the course of a few days. I don't know if she got any notification, or what.

 

[brewer12345]

Nowadays, the bank charges you $35 (and covers the check??). Anyway, her balance got negative, and six overdraft charges came in over the course of a few days. I don't know if she got any notification, or what.

That's about right. They send you notification, but the mail usually takes a while and you rack up more fees that way.

 

[stargazer08]

I've got one daughter still in college. She's no dummy. She won a full scholarship based soley on merit to the Milwaukee School of Engineering. For the life of me, that kid had absolutely no interest in balancing a check book not to mention keeping a check register! Her idea of balancing is going to the ATM and seeing if there is money in the account. Works great if checks you write are deducted from your account the minute you write them but that's not the case. I have given up on the subject. She works 30+ hours a week while attending school full time and is paying her own way with our small contribution to her room and board fund. She'll come around in the future. Now she's just focused on working and school and hitting the bars now that she's turned 21. Thankfully, our credit union will pull money from your savings to cover overdrafts....for only 5 bucks. I just remind her of the number of diinners out she could have had with all those returned check fees.
You can lead a horse to water but you can't make it drink. That's the way I'm choosing to deal with this issue.

 

[youbet]

Washington Univ is doing very well in the NCAA Div III BB playoffs. All the way to the final four I believe. Perhaps a special allocation of party funds would be appropriate TA?

 

[Sandy]

I am hoping my kids will avoid this when older, but you never know.

My son loses things. he swims, he misplaces his goggles often. He pays to replace them and I hope that at some point the light bulb will click on and he will be more responsible (his twin sister never loses anything). All I say is "well, if this is how you want to spend you money" and off we go to get another pair. Figure, maybe we can work on this battle now rather than when he is bigger and can get himself in real financial trouble.

Al
Maybe after 6 months of rubber checks, get her to add up all the fees so she can see what this is costing her and let her develop a list of the things she could have done instead. At least you aren't bailing her out. But scarey and frustrating I am sure.

 

[TromboneAl]

Thanks for letting me know I'm not the only one in this situation.

She comes from a long line of flakes, yours truly included. I'm one of the few in the family who has learned to compensate for my flakiness.

Unfortunately DW's non-flakey gene didn't get passed on.

 

[Nords]

Man, this must be frustrating. It sounds like you're working a lot harder on the issues than she is.

Nowadays, the bank charges you $35 (and covers the check??). Anyway, her balance got negative, and six overdraft charges came in over the course of a few days. I don't know if she got any notification, or what.

Not all banks cover the check.

When I was treasuring a small non-profit we'd throw eight horse shows a year. At least one of the entry checks ($35-$100) would bounce. The payer would be out whatever fees their bank charged while the non-profit would have no entry money and an additional $20 charge from our own bank for processing a bad check. So we'd have to hunt down the miscreant for their entry fee plus our bank fee, presumably while they were trying to figure out how to pay their own bank fee.

 

[Fireup2020]

Sounds pretty typical. Just because parents "want" their kids to do as they say or even do, some lessons must be learned the old fashioned hard way. I am sure she has a good foundation - she'll turn around in due time.

Unfortunately, you have no control over when that time will be. Hang in there!

 

[Peaceful_Warrior]

So far, I've learned most of my financial lessons by listening, observing, and just paying attention.

Financial wisdom throughout my life:
- Age 7:
Me: "Dad, I want an allowance raise."
Dad: "Hear, read this and then we'll talk."
- He handed me a copy of 'How to Negotiate Anything'

- Age 18:
Dad: "When you go to college, do two things. First, get a checking account. Second, get a credit card, use it every month, and always always ALWAYS pay it off on time."

Those two things really paved the way for me. Life really is SOOO much easier with good credit, especially when it comes to buying cars and homes.

Sounds pretty typical. Just because parents "want" their kids to do as they say or even do, some lessons must be learned the old fashioned hard way. I am sure she has a good foundation - she'll turn around in due time.

Unfortunately, you have no control over when that time will be. Hang in there!