The beginning of fall marks a new chapter in the lives of thousands of college freshmen. Many students are moving away from home — and making their own financial decisions — for the first time in their lives.

Parents may feel reluctant, or even afraid, to let their child take the reins and manage their finances independently. But if you equip your graduate with the ability to make smart financial choices, when they leave the nest they’ll stay out of financial trouble.

CREATE A BUDGET

A budget is your teen’s road map to smart spending and staying out of debt. Help your teen calculate his or her monthly income, including any financial support you’ll be offering. Be upfront about what you are providing financially, so that he or she has clear expectations of his or her responsibilities.

Next, list monthly expenses, including rent, cellphone bill, utilities, food, entertainment, savings and transportation. Separate these into columns of “needs” and “wants.” If your teen is spending more than they’re earning, discuss how to reduce expenditures for wants.

FIND A FINANCIAL INSTITUTION THAT WORKS FOR YOU

Whether your child is attending college on the mainland or in Hawaii, it may be a good time to set up an account to manage finances independently.

Look for a financial institution that offers accounts without setup fees or minimum-balance requirements. You may also want to check whether transfers from other financial institutions incur a fee, in case you need to transfer money to your child’s account. Many credit unions offer products and services with little or no fees.

Once your student finds a financial institution, encourage them to set up an automatic transfer from a checking account to a savings account every month. Start with as little as $10 a month — the point is to get into the habit of saving early.

USE CREDIT CARDS WISELY

Getting your teen a credit card may feel like putting him or her on the path toward debt. However, credit cards aren’t bad, as long as they’re used responsibly. A recent survey by Sallie Mae revealed that 63 percent of college students with credit cards pay their balance in full every month, meaning they are spending within their means while building credit and earning rewards. That’s a smart use of credit.

The No. 1 rule of responsible credit: Don’t spend what you don’t have. Let your teen know to keep credit card balances under 30 percent of available credit, since high credit utilization can actually hurt a credit score.

With a solid financial foundation in place, your college-bound teenager is well-equipped to be a savvy spender and smart saver.

Jennifer Russo is the financial educator at Hawaii State Federal Credit Union, providing learning opportunities and community outreach to strengthen financial literacy in Hawaii.