This week, thousands of parents will send their teenagers off to college. Before they leave, BBB urges parents to talk to their kids about money, credit and scams.
Checking account — Many college kids will have a checking account with a debit card. Parents should discuss overdraft fees, keeping checks in a safe place, using secure internet connections to check balances, and liability if debit card is stolen.
Credit cards — College kids are deluged with credit card offers and incentives to sign up on campus. Parents should discuss late payment and over limit fees, interest rates, impact on their credit reports, liability if card is stolen, using a safe internet connection to check their balance, email and text spoofing scams from “banks” about problems with their card or account and shredding documents with personal information. A small lockbox is a great way to secure personal documents.
Credit report — College is the time when young people first begin establishing credit through a credit card or student loans. They can get a free credit report from each of the three credit bureaus each year at www.annualcreditreport.com. It’s important for parents to check their kids’ credit reports on a regular basis to insure that no credit accounts have been opened in their name.
Identity theft — Identity thieves target young people because they have little to no credit which means they typically don’t have credit blemishes. Plus, it takes young people longer to find out that they have been the victim of identity theft because they may not check their credit very often. Parents should warn their college bound kids about not giving out personal information to anyone who calls or emails them, especially their social security number, banking or credit card numbers, birth date and home address.
Friendly fraud — Although there are high tech ways that someone can steal your identity, the most common way that young people become identity theft victims is through friendly fraud. Friendly fraud occurs when a roommate, family member or friend uses their debit card or credit card without their authorization or opens up new credit accounts in their name without their knowledge.
Requests from friends — Parents should make sure that their college bound kids know about the ramifications of co-signing loans or utility accounts for friends, lending money to friends, or letting a friend use their credit card.
For more information about credit, fraud, or identity theft, visit BBB.org.