Huh? Hit rewind a second there. Basic money habits? 

Yes, those! Have you thought about how to manage money at all? Let’s talk about why it’s a good idea.

Why Learn About Money Now?

Why learn about banking, how to spend, borrow wisely and pay for college? Easy: These habits can stay with you your whole life. Also, you typically don’t learn these concepts in school, so it’s a good idea to study them yourself or with a trusted adult.

Money Topics You Won’t Learn in School

Quick — make a list of money topics your math teacher never brought up. Sure, she’ll teach you trigonometry basics till your brain hurts — but will she teach you about basic banking, borrowing and financial aid to pay for college? 

Probably not. 

It’s best to get a trusted adult (whether that’s a parent, a college admissions counselor, your school counselor, etc.) to walk you through complicated money concepts. 

Basic Banking



Do you have a checking or savings account? 

You probably know what savings accounts and checking accounts are, but do you know the technical details? Just in case, let’s go over what each one actually offers.

Earnings

What do you do when someone gives you money for your birthday? 

Do you… 

• Deposit it in the bank?
• Zip online ASAP to nab those ahhhh-mazing jeans?
• Stuff it under your mattress?
• Ask your uncle Sal, the investment banker, for money advice?
• How you make spending decisions now could impact your future. 
  

Outline Your Goals

When you save your money, you’ll be amazed at how it builds. Keep it in a savings account and you’ll see small incremental interest on your accounts. 

Challenge yourself. How much can you save during a given month? Every six months? A year? How much do you want to save? Write it down — and why you’re saving your money.

Consider Investing 

Remember how Uncle Sal kept bugging you about a Roth IRA? Turns out, Sal probably knows a little bit about money and is probably a great person to chat with. Turn to a trusted adult if you’re interested in investing.

How is saving different than investing? Saving (like putting money under your mattress) or in your piggy bank from third grade doesn’t do a good job of leveraging your money. Investing your money gives you the potential to earn more. Consider investing your money in a Roth IRA or a custodial account (that an adult helps you manage). You’ll be even more amazed at the power your money has when you invest.

Borrowing 

Do you have access to a credit card? It’s an amazing way to build credit — it shows lenders in the future how well you can pay off debt. 

So… What exactly is credit? Credit is borrowing money with the understanding that you'll pay later.

A few key concepts: 

When you have a credit card, it’s a good idea to pay off your credit card every month.
If you borrow to go to college, you pay your student loans off later.

Someday, if you get a car loan to buy a car, you pay it off in installments — small payments every month. 

Try to borrow only what you need and can pay back responsibly.

Paying for College

Paying for college deserves its own special category. Let’s talk a little bit about paying for college and what that involves.

One of the most important things you must realize is that college costs require more than just tuition, room and board. In fact, here are a few more common costs:

Financial Aid

Financial aid, laid out in something called a financial aid award, is the key to tackling all of these costs. Here’s a quick overview of the types of financial aid you can receive.