NEW YORK (AP) One of the toughest decisions parents make as they send their children off to college is whether to pack checkbooks, debit cards or credit cards that the kids can use for school costs and personal expenses.
Checking accounts and debit cards have the advantage of imposing limits; if there's no money in the account, the kids can't spend. Credit cards may allow more spending flexibility especially in emergencies but they can risk enticing the kids to overspend and take on debt they can't afford.
Experts say the decision should be based on a child's maturity and comfort with money. They also recommend parents be aware of their children's spending, regardless of the payment option they choose.
''In high school, the parents take care of everything financial for their kids,'' said Steve Avdul, co-author of ''Real Life 101: A Guide to Stuff That Actually Matters.'' ''When they graduate, the kids will be on their own. College is the transition, and it needs to be a partnership.''
Scott Hanson, president of HMA Public Relations in Phoenix, said his son, Mathew, 18, will head for Northern Arizona University in Flagstaff this fall with a checking account. Mathew has been building up his balance with pay from his summer job at a fast-food restaurant.
''It's his checking account, but if we needed to, we can put money into that account for him,'' Hanson said.
The account has a linked debit card, which Mathew can use to buy gasoline or get cash, Hanson said. But Hanson has ruled out a credit card, at least for now.
''I'm a big believer in living within your means, and I think it's much easier to track expenses with a checking account,'' Hanson said. ''I worry that with a credit card, if kids don't completely understand how it operates, it can get away from them.''
Neale Godfrey, author of ''Money Still Doesn't Grow on Trees: A Parents Guide to Raising Financial Responsible Teens and Young Adults,'' recommends families consider cash cards.
A number are now available, including the Visa Buxx prepaid card, which allows parents to supply money by phone or on the Internet and to monitor how it's used. Kids can use it like a debit card to purchase products or like an ATM card to get cash.
''First, you need to put your child on a budget,'' Godfrey advised. ''Let them estimate what it's going to cost, item by item, for food, clothing, incidentals. And put only that amount on the cash card.''
The advantage, she said, is that it helps young people learn to live on a budget.
''Make sure they collect receipts and go over them with you,'' she said.
Kateri Callahan, president of the Alliance to Save Energy in Washington, D.C., said she got Visa Buxx cards for her teenage children several years ago.
''We were getting nickeled and dimed for money, so we started putting a set amount on their cards each month,'' Callahan said. ''They learned how to manage money. They watch how much in on the cards.''
She added that she can put additional money on the card via the Web or a phone if her children need it for a special purchase.
Her daughter Conrey, 18, who will be attending Vanderbilt University in Nashville, Tenn., this fall, will be funding the card with her own savings.
''A lot of my friends are getting a debit card or their own credit card,'' Conrey said. ''But not checking. Most of my friends never use checks anymore because plastic is much more convenient.''
Another option is a credit card tied to the parents' account. MasterCard offers a Family Account that allows spending limits to be customized for each card. Monthly statements break down purchases for each individual using the account.
Robin Katz, a group leader for Weight Watchers who lives in Roslyn, N.Y., will be sending daughter Danielle, 17, off to Boston University in the fall with a credit card linked to her account. Danielle also will have a checking account at a bank with branches in both Boston and New York to make it easier to deposit money, Katz said.
Katz said her daughter has been using a credit card for about a year.
The main advantage, Katz said, is security: ''The card just seems to be a better way than having her carry a lot of cash.''
Steve Avdul and his brother, Derek, who wrote ''Real Life 101,'' favor credit cards for college students.
''It can be a good tool. The goal is to teach them (your kids) to use it responsibly,'' Steve Avdul said.
Derek Avdul suggests parents co-sign for credit cards for their children rather than giving them a card on the family account.
''You want that student to get practice in receiving month bills and being responsible for paying them,'' he said. ''And it will help them establish their own credit rating.''
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