Do you need to get cash to your college student in a snap? Here’s a look at some of your options.
A month into the fall semester, your child calls with an exciting update. Their drama class teacher has access to special seats for a hot play opening nearby and has offered to make a class trip of it for everyone. The catch: Your child needs cash to pay back the teacher for the transportation and ticket, which turns out to be a nontrivial amount, plus, a dinner afterward at a famous restaurant where all the actors often hang out.
So what are some of your options when your child needs money?
There are of course traditional options, like bank and wire transfers or checks, but a big drawback is that these options can take time.
If you need to get cash to your child fast, person-to-person applications may be your best choice. Often at no charge, they let you transfer money to your child almost instantly. A number of service providers now offer various details and nuances that you need to be aware of.
Here are three scenarios to consider and how such person-to-person payments can help:
1. Your child asks you to help foot the bill for their night out.
In this case a social payment app might come in handy. These apps allow you to transfer funds to members you are linked to. Unlike the above-mentioned linked payment apps, social payment apps include a social feed that may allow others to see that you transferred cash, making them less private. If you are uncomfortable sharing with the world that you’re sending funds to your child, look for a setting to hide or turn off the social feed.
2. Your child asks you for money to cover an emergency medical expense.
You might consider using a linked payment app. These apps allow you to transfer money from a linked bank account, or debit and credit card. You can use these apps to transfer cash, or pay a vendor or business directly. A drawback is that you may incur fees for using credit cards or for expedited payments with these apps.
3. Your child needs help to quickly cover the security deposit of a first off-campus apartment.
An app linked to a financial institution may be a good option. One option is Send Money with Zelle®, which is integrated into hundreds of mobile apps, including Morgan Stanley’s. Zelle lets you send money at no cost to almost anyone you trust who has an account in the U.S., using their preferred email address or U.S. mobile phone number. This also means that you can send or receive money without having to share your account credentials with the other party, a big benefit. Even if the other party’s financial institution doesn’t participate in the service, they can still receive funds using the Zelle service.
Don’t Neglect Cybersecurity
All online transactions carry the risk for fraud and theft. Review ways you can bolster your online security to strengthen your online profiles and accounts. Make sure your child is aware of these tips as well. When choosing an app, look for features like two-factor authentication to boost the safety of your transaction.
Having your child leave the nest to start college may be a perfect opportunity to have a conversation about money, creating a budget, and starting their own financial journey. Contact your Morgan Stanley Financial Advisor for resources to have these conversations.