05 Mar My college kid is using my credit card too much. Is there another way?

Q. My daughter is a college freshman and I made her an authorized user on a credit card for some expenses and to have for emergencies. She’s spending too much on it and I don’t want to take it away, but we need a better plan. Is there another way I can make sure she has enough money and also something for emergencies?
— Mom

A. We’re glad you asked.

Freshman year, for a lot of students, is their first experience of living without supervision from parents. A part of the college experience is figuring out how to be financially responsible.

The first step is to have an honest conversation with your daughter, said Matt Rembish, a certified financial planner with OneDigital in Boonton.

He said it’s important to set ground rules for when using the card is acceptable.

“Use of the card is a privilege, not a right. If she is using the card for most of her expenses, I would work with her on a budget that works for both of you,” he said.

Ask yourself: Where is she spending her money? If she is using the card to go out to eat with friends? Is that something that is off limits for card use? Or are you okay with her spending a certain dollar amount each month for that kind of expense?

“If there is still a spending issue after your talk, I would take away the credit card and look at other options,” Rembish said.

One option is a prepaid debit card.

“She won’t be able to overspend because you control how much is on the card,” he said. “There are options that are `reloadable’ so if the card balance gets low, you can always add more.”

Another option is for her to sign up for her own credit card. She may be less willing to spend when the credit card is in her name, and she is responsible for the payment, Rembish said. It’s also good to have her start building her credit, he said.

“I once was a `broke college kid,’ and that experience really formed my current relationship with money,” he said. “If you don’t have that credit card to fall back on, you get creative. That may be in the form of a part time job or saying no to something fun.”

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This story was originally published in February 2025.

NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.