College defines a special time when a meal can consist of Ramen with a side of Pringles and there's an average of only one or two dollars in your wallet. Being "a poor college student" also means you need to step up and get your own job and formulate your own budget. Such a concept can be quite foreign to students who've never had to manage money on their own before.
Sophomore Christian Andersen sums it up nicely. "By "money management,' you must mean having none." he says.
So how do students provide for themselves once leaving home? It's not always as simple as phoning home. "It is not like you can just ask mom and dad for a twenty to go out with on the weekends," said sophomore Maria Cirincione.
Despite their limited funds, most kids seem to accept the new way of life. A universality among college students is the challenge of not only becoming financially independent, but also understanding how to manage money well. College equals change for many, change that can be broken down to dollars and cents.
Natasha Horton, branch manager of the Homewood branch of M&T Bank, feels the biggest problem with Hopkins students is their inability to remember how much is in their accounts. She says students will often go to the bookstore and then the mall not realizing they have exceeded their account balance. Once this happens students are charged a fee of thirty-one dollars along with the amount over the balance. Many students do not realize the severity of improperly balancing funds. "Students forget to write down items purchased and one little item can cause them to overdraw an account," Horton said.
In first case offenses, students are offered a payment plan, but repeat offenders are reported to both the credit bureau and a collecting agency. A student usually has between thirty to-ninety days to pay their debt to the bank money.
Some students overdraw their accounts by as much as $300 to $700, making it difficult for them to produce funds to pay back the bank in only a few months. These students can also be categorized as having not only a delinquent account, but also bad credit.
M&T offers 10 different checking accounts and according to Horton, checking accounts are safer than credit cards. With the check card, you can still purchase items as if it were a credit card, but you need to stay within your account balance. Horton feels students that have unlimited usage on credit cards often run into the bigger debt problems.
Parental involvement can also be a cause for concern. "The problem is most parents come in here during orientation weekend and set up the student's account. The students should be taking care of it, not the parents because they aren't at school using the card," Horton said.
The new Privacy Act mandated by the federal government also causes confusion for college students and their parents. Many parents call and complain when a child's account is deactivated, but if the account only lists the student's name, the bank counselor cannot give out any information to the parents. This angers parents, but Horton remains resolute and tells them that they should have read through the information packets given at the time of opening the account or had the student read it.
Another problem students run into is fraudulent activity. Many students leave cards behind, later finding mysterious purchases placed on their cards.
Cirincione dealt with such an unfortunate incident last year at the J-store ATM. "I lost all the money I had in my account because the ATM was broken and stored all of my card information," she explains. "Someone then tried to take money from my account. Fortunately my card limit is $200, but unfortunately they took that, and I was never reimbursed,"
Incidents like that one keep Cirincione from using a check card. Now she cashes her checks from work and pockets the money.
Michelle Mayagoitia does not use a check card either. "Freshman year my mom cried and said "baby, you could have whatever you want,'" the now sophomore says. The catch was that Mayagoitia's mother would only provide her daughter with cash. She also decided the best way to ensure that her daughter would travel frequently to their Washington D.C. home was to dispense the cash in person. Mayagoitia found that she spent a lot of quality time with her mom freshman year.
Julia Finkel's parents provide money for food and the junior has to pay for anything else she wants. Though she works a couple of campus jobs, she feels that she can balance everything. She mentions, however, that a tight budget can be challenged by "surprise" expenses such as a parking ticket or having your car towed. She also finds that the hardest part about living on your own is not having what she calls a period of financial "rebuilding" like she did before freshman year. Upon entering college, Finkel had plenty of profit from her summer job because her parents paid for food and she lived at home. She spent the following summer at Hopkins and missed the extra money she enjoyed when living at home.
Andersen uses his credit card for convenience only. His parents pay for food and rent for his off-campus apartment. Andersen uses the money from summer jobs to pay for his expenditures. "I have plenty of profits saved from various summer jobs. I have done anything from life guarding to air conditioning repair," he said.
Many students like not having to ask for money or justify where and why they are spending money. And, overall it is better to have a checking account than your parents checking up on you, even if financial freedom actually limits your finances.
