Five Steps To Financial Savvy Freshmen

North Shore Bank Offers Tips to Help College-Bound Students be Financially Smart

BROOKFIELD, Wis. - Going off to college is an exciting and challenging time for students and their parents, and it is also often the first time a student has complete control over their own finances. To help students navigate the confusing and sometimes debt-inducing financial waters of credit cards, online banking, check cards and more, North Shore Bank has put together five tips to help college-bound students survive college with minimal debt.

"College students often are inundated with credit card offers enticing them to sign up and get a free gift or offering substantial credit limits," said Steve Arps, vice president and northeast district manager for North Shore Bank. "It can be very appealing for a teenager to suddenly have all of this money at his or her disposal. However, students who have not had previous experience handling their own finances may not realize that maxing out a credit card, not paying their bills on time or overdrawing their checking account can have serious, long-term effects on their financial future."

According to Nellie Mae, the nation's largest provider of student loans, approximately 42 percent of college freshmen have one credit card. In comparison, the same study showed that 91 percent of final year students have a credit card, with 56 percent of seniors carrying four or more cards. The average balance for freshmen is $1,585 and $2,864 for seniors.

"We want to help educate students to be successful in their personal finances as well as in the classroom," said Arps. "Understanding and appreciating finances can go a long way toward enhancing the college experience and makes it much easier for students to get a car loan or mortgage after graduation."

Arps offers the following five "student survival tips" to help college-bound students manage their finances while off at school.

1. Use credit wisely - A credit card should only be used for emergencies, and the balance should be paid off each month, according to Arps. College students have numerous opportunities on and off campus to get credit cards, but don't be fooled into thinking it's "free money." Remember, credit card bills need to be paid back - and with interest. That $20 purchase can wind up costing twice as much.
2. Use a check card - also known as a debit card - and balance your checkbook often - A check card provides quick access to available funds, but also requires careful monitoring. Each transaction should be entered into the checkbook as soon as possible to avoid overdrafting on an account. Make use of online banking to check your account activity 24/7 to make sure all your transactions match your recorded uses.
3. Save, save, save - Everyone should establish a savings account, said Arps. Students should set aside a portion of money earned at part-time jobs for future emergencies and purchases. This money can then be tapped into to buy that new bicycle or go on spring break, rather than charging it.
4. Set a budget and stick to it - Students should review their monthly expenses and cash inflow, then set a budget and really follow it. This will force them to take a good, serious look at their finances and see just how much money is really spent on entertainment and other non-essentials, said Arps.
5. Limit/Eliminate impulse purchases - Before buying that new CD, pair of jeans or latte, students should ask themselves if they really need the item and if they can pay cash for it. Luxuries such as music, eating out, clothing and the like should be limited and should never be charged.

"Through careful planning and controlled spending, this fall's college freshmen will be well on their way to a financially successful undergraduate experience," said Arps.

These tips are also available on the bank's Web site at www.northshorebank.com, and students can speak to a personal banker at any North Shore Bank office who will help them prepare for these financial challenges.

North Shore Bank, headquartered in Brookfield, was founded in 1923. It has assets of $1.9 billion and 40 offices throughout eastern Wisconsin. Current branch locations are in metro Milwaukee, Racine, Kenosha, Appleton, Menasha, the Green Bay area, Burlington, Union Grove, Two Rivers and Door County. North Shore Bank also has a mortgage production office in Tampa, Fla.