As I mentioned last time, New Jersey has revised its high school graduation requirements, mandating the teaching of financial, economic, business and entrepreneurial literacy starting in 2010.  In that post, I talked a bit about Internet-based high-interest checking and savings accounts.  Here are two more suggestions for young folks who may be managing for their own money for the very first time.

2. Free is Good: So you’ve got your high-interest savings and/or checking account, but the bank now expects you to pay for your checks.  “Free checks” is often a carrot banks dangle to get you into a higher tier checking program (e.g., one with a minimum balance or annual fee), but it’s one our students can avoid if they know they can get checks for free or cheap.  VistaPrint is an online service that follows the freemium model of business – provide a basic service for free, and allow customers to pay for upgrades.  Provided we can teach our students to get past the idea that they have to have custom checks with sports team logos or cartoon characters on them, VistaPrint offers six basic check designs for free.  Customers select a design, customize the check with their name, address, & account information, and presto, free checks – all they have to pay for is shipping.  You can, of course, upgrade your checks with monograms, premium designs, etc., but let’s be real: what makes more sense, getting the Looney Tunes on your checks, or getting them for next to nothing?

3. Get Rewarded: Rather than signing up for a credit card at your college’s student center based on the free t-shirt or frisbee you’ll get, let’s teach our students to shop around for credit cards with some kind of reward program.  I’m not sure if these are available to new credit card users or only people with established credit, but if you can find a card like Capital One’s No Hassles Reward Card or a store-branded Visa or Mastercard (e.g., the Amazon.com Visa), you pay no annual fee, and each purchase you make gives you points toward some reward.  In the case of Amazon, every 2500 points is worth a $25 gift certificate to Amazon.com.  Capital One has a tiered rewards system, but since I’m not interested in any of the rewards they offer, I just trade my points in for cash toward my bill once I’ve accumulated enough.  It’s important to note that use of these cards should be guided by responsible spending, not just trying to rack up rewards points, but my thought is that if I’m going to have to pay for something anyway (e.g., cell phone bill), why not put it on the credit card and at least get something back for it eventually?

As always the technological component has to be balanced with a human behavioral component – don’t spend more than you can afford, create a monthly budget, beware of compounding interest, pay your balances off each month, etc.  These lessons are most important; I simply offer some supplementary advice here.

What are your top financial tips for young people just learning about managing money?  If, like me, your kids are significantly younger than high school age, how did/do you get them off to an early start with good ideas and attitudes about money from a young age?