DENVER (CBS4) – Next month young people will be packing up and heading off to college. So many parents want to know what is the best way to open a debit or credit account for their student.

Tasha Dokes can go online to check the balances in her two daughters’ debit accounts.

“It pops up with Nastasha’s account and asks, ‘How much do you want to transfer?’ I say $10,” Dokes said.

Dokes uses PayPal to make direct deposits in her daughters’ accounts.

“I don’t have any fee associated with transferring money,” she said.

But that wasn’t the case when Dokes bought a prepaid debit card off a store rack for her daughter.

“Every time I transferred money to her account it was like a $3 fee. Then when she used it, it was anywhere from a $1 or $2 fee for each purchase,” Dokes said.

Sara Gilbert is a consumer counselor who warns parents about hidden fees.

“You want to be really clear with those cards about what the fee structure is and how you and your student may end up paying for those cards,” Gilbert said.

Gilbert says it could be better to get a bank card in the student’s name. But again, make sure it doesn’t come with hidden fees.

On the credit accounts parents can check their students’ spending.

“I think it’s a good idea, but you probably need to have conversation with your student ahead of time,” Gilbert said when asked if checking on spending is sneaky.

Megan Ryan and her mother had that conversation. Ryan has a debit card but is worried about the new autonomy she’ll have as a freshman at Colorado State University  next month.

“I am going to have trouble. I know I’m going to have to adjust to it because I haven’t had to completely fend for myself,” Ryan said.

Gilbert suggests giving the student a bank debit card before they go to college so they can establish good spending patterns. Set up an account at a bank on campus so they have access to an ATM without paying fees. Some banks waive monthly fees if the checking account is linked to a savings account. Get overdraft protection with that as well.


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