Financial Education for the College Student

NEW YORK (TheStreet) -- Q: My 18-year-old son just started college this last fall. I gave him a credit card in his name, attached to mine, with specific instructions to be used for books, occasional dinners out and emergencies only. I'm privy to the balance and occasionally check it out online.

He's home on holiday break and has misused it a few times. I didn't realize he was overspending until he said something. Apparently he wanted to tell me before I saw the recent charges. I appreciate his honesty and I'm not really angry. I just want to respond correctly and take the right actions with him. Should I take the card away for a while or just implement a clearer budget, what type of talk should we have? Thanks, Noah.

A: College isn't merely about choosing and completing a course of study. It's about learning to be independent and make personal choices. This includes the acquisition of financial literacy and the ability to make responsible financial decisions.

The fact that your son told you about his credit card spending/debt, prior to your reading the online statement is a very good sign.

I've heard a number of horrors stories involving young adults who were in debt. However, due to a lack of support they put themselves in harm's way in order to resolve their finances. Perhaps if their families had been more transparent the crisis could have been averted.

I would absolutely address the misuse and present him with consequences for his actions. You might specifically assign his credit card as "emergency use only." However, you need to be very clear in your definition. Suspension seems too harsh, as you want him to feel safe and provided for in dangerous scenarios.

I advise all incoming college students to gain financial education prior to starting school. This could come through parental tutorials or that of a financial professional you trust.

As grownups, it's easy to forget that young adults don't have the financial vocabulary we've garnered through living. Wise spending is as important as learning to drive. Think of it this way: Would you give him your car keys if he didn't know how to drive?

I look forward to hearing how the conversation went.

Questions and comments can be sent to ASK NOAH at [e-mail]

Have a profitable and peaceful week,

Noah

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Noah Kass is a psychotherapist specializing in addiction, relationship issues and work stressors. He has been Clinical Director at The Dunes: East Hampton and Realization Center in Union Square. Mr. Kass was a frequent guest on MSNBC's "The Dylan Ratigan Show," featured in a segment called "Kass' Couch" and regularly blogs for The Huffington Post.