Financial aid is meant to pay for all your necessary college expenditures that your expected family contribution does not cover. This includes tuition, room and board, any university expenses such as activity or lab fees, books and supplies. Many studies receive refunds after tuition is paid to cover the remaining costs, and are allowed to decide for themselves how to divvy up the funds.
Students today are spending much more on nonessential items than previous generations. It has become commonplace for students to purchase high-end clothing; electronic items such as MP3 players, video games and laptops; and even alcohol. These items often exceed the amount allotted in the college's cost of attendance allowance for room, board and supplies. This leaves the student broke, with no means of paying the bills outside of asking his parents for help or using credit cards.
Students have come to believe that they are entitled to these luxury items because their peers have them. Students often believe that they deserve some fun or a splurge to reward themselves for working hard and studying hard in school. These students are likely to rationalize spending money on items that are not essential, leaving them short on cash. College is also often a student's first experience with budgeting; he may not realize how quickly he is spending his money.
The best way to prevent this issue from arising is to instill in teenagers the importance of managing your money. But if the issue unexpectedly arises later, teaching teens how to create and stick to a budget can be invaluable. Showing teens how much money is actually theirs to spend as they please will show them how little leeway they have for impulse purchases or splurges. Finally, making sure they understand the consequences of late bills and racking up credit card debt can go a long way towards preventing this issue from ruining a teen's financial future.