Teach Students to Pace Their Spending With Daily Scheduled Deposits
By
Staten Island, NY Posted: 10/2/2014 1:00:00 AM
Does this text message conversation sound familiar?
Parent: How's school?
Student: SEND MONEY!
Parent: Didn't I just send you money?
Student: SPENT IT... PLEASE SEND MORE!
Parent: Okay, but try to pace yourself this time. This is the third time you've gone over your budget this semester.
Student: Thank U soooo much! Love U.
First of all, college students need to understand that writing "Love U" makes them look like they're still in grade school, but that should be the subject of another Idea Of The Day.
If you look at the course requirements to get a college degree, one thing that is missing is personal finance. For a lot of students, a budget is more difficult than calculus. For students who have trouble pacing themselves, it's feast or famine. In the days before they receive their weekly or monthly income, they have nothing left, and the moment the money arrives, they spend way too much... way too fast.
It seems that the only way some students learn to follow a budget is to have one forced upon them.
One great way to teach students to budget themselves and to insure they don't run out is to use an automated daily schedule of deposits, which you can set up with most online banking websites.
The idea is simple. Every day the student gets enough money to cover their daily needs, plus a little extra as a safety net, nothing more. In time, they will learn to spend just enough and even watch whatever they don't spend grow.
I think many adults (including myself) would love to have an account like this for their personal spending. The idea would be that your income would still go into your main checking account, where you pay your regular bills, but then you could create a daily deposit of about $20 or so into another account that has a debit card for personal spending, to cover food, coffee, newspapers, etc. If it's done right, you would see that account grow on days you brown bag your lunch, and you could give yourself a guilt-free reward when it gets big enough for that new gadget you've had your eye on.
Joe Crescenzi, Founder
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