When parents send their kids to college, they’re hoping Johnny or Susie graduate with a degree and a shot at the good life that comes with that piece of paper. But a growing number of college seniors are also graduating with something else that could affect their future – credit card debt.

College seniors graduate with an average credit card debt of more than $4,100, according to a 2009 study by Sallie Mae. And the ave
rage balance for all college kids (and 84 percent of them have at least one credit card) is $3,173, the study showed. From tuition and books to food and gas, college students are using credit cards to pay for everything.

Parents may wonder how all that debt will look on a credit report, when the individual being reported on doesn’t even have a steady source of income yet. How will starting their professional and personal lives already in debt affect their long-term financial health?

It’s never too late – or too early – for parents to start giving kids guidance on how to manage credit. Before your college-aged child gets her first credit card, make sure she understands how credit actually works and how her credit report affects her ability to get loans – and possibly even a job – in the future.

You can try several different tactics to help guide your child toward a better understanding of credit, including:

1. Introduce her to her credit report. As an adult, she may choose to review her credit report on a regular basis. As a young person who’s just starting to use credit, she should also look at her report. Not only will it help her understand the basics of her credit score and what factors determine it, checking her credit can help catch any fraud. Identity thieves have been known to target people with very little credit history, such as children.
2. Help her open a checking account. With a joint account, you can monitor how she uses her debit card. It’s also an opportunity to teach an important basic financial skill – how to balance a checkbook.
3. Lead by example. If you’ve been able to avoid high credit card debt, help your child understand the steps you took to do so. Clue her in to how smart credit use has helped your credit report, and how in turn, your good credit has helped you make purchases that have enriched your life – like the home you share. If you’ve made mistakes, let her see the consequences you face; she may be able to learn from your mistakes without having to repeat them.
4. Permit her to have a credit card, one that you’ve co-signed for, early on. As the responsible adult on the account, it’s up to you to show her how to responsibly use credit. Make sure she gets the bill – and pays it off – every month.
5. Make sure she understands the importance of reading the fine print on credit card offers. Penalties and fees can run up the balance on a teen’s credit card almost as quickly as imprudent spending.Finally, don’t despair if your college student already has a credit card (or more than one) with a balance on it. Help her view this as an opportunity to improve her credit score. Sit down together and create a plan for paying off the debt. Think how good it will look on her credit report if she demonstrates her ability to manage debt before she even graduates from college.