IF YOU HAVE A

college-bound teen, prepare to hear all of the reasons why that mini-fridge, bean-bag chair, Nintendo Wii and other dorm room "essentials" are critical to their academic success. Weed out the packing list if you must, but make sure you don't send your kid off to school without two vital financial tools: a foolproof bank account and credit card.

College students are prime targets for credit-card issuers and banks alike, says Ruth Susswein, a spokeswoman for advocacy group Consumer Action. Students tend to be loyal customers, and their first financial stumbles can yield big bucks for the financial institutions that snare them. "College is the only time in a person's life when you can get credit when you don't deserve it," she says. "Students are just bombarded with offers."

Like it or not, the pitches work. Nearly 80% of students have at least one credit card by the end of their freshman year, according to lender Nellie Mae. Before your son or daughter starts classes, sit down together for a few lessons on smart financial management and debt. Here's what to look for when helping them select the best financial tools:

Bank Accounts

Avoid campus checking

At Penn State University, students' ID cards do more than get them access to the dining hall they double as PNC Bank debit cards that can be used anywhere credit cards are accepted. New Mexico State University students can link their's to Wells Fargo accounts. But the increasingly popular partnerships between colleges and banks are bad news for students, says Ed Mierzwinski, consumer program director for the U.S. Public Interest Research Group, a consumer advocate.

Terms and fees are mediocre at best. Wells Fargo College Checking, for example, assesses monthly fees for everything from maintenance (up to $3.75 just for having the account open) to unlimited debit card purchases ($1). Meanwhile, most college campuses partnered with Wachovia allow only PIN transactions, limiting use of the card it can't be used online, say to buy an airline ticket, or at restaurants, for example.

Balance home and away
Instead of taking the college's banking option, look for a bank that has branches both in your hometown and in the city where your child is attending school, advises Susswein. That enables your student to have a seamless financial transition between school years with no pricey fees for using other banks' ATMs while on break. Plus, you'll have an easy way to deposit money into their account in an emergency.

Ask about student accounts
Compared with banks' standard free checking accounts, student accounts offer distinct advantages. Wachovia's Free Student Checking allows you to transfer money between checking and savings at no charge and offers four free non-Wachovia ATM transactions per statement features for which consumers with other accounts pay up to $12 a month. HSBC's Student Checking account lets college kids write as many checks as they want without paying a fee. HSBC customers with regular checking accounts can write only eight checks for free before they start getting charged 35 cents per check.

Tack on a high-yield account
For a list of the top yields, click here

Credit Cards

Eschew the free T-shirt

"Be absolutely wary of a card that's offered with a free T-shirt, free Frisbee or anything else" warns Mierzwinski. On-campus card marketing is still a big problem, and the gift-with-application is usually the most attractive part of these offers, which include high APRs (19.79% variable for the Capital One Platinum Card) and nasty fees (maintain a $3,500 balance with the UpFront Rewards Visa, or pay a $600 fee).

Move beyond student cards
"There's no point in going for a student card unless there's some advantage offered," says Scott Bilker, founder of DebtSmart.com. Rates on student cards average 16% to 18% instead of the average 14.57% variable rate for a standard card. The catch? Without an established credit history, your child may not be eligible for the real deal. Still, apply for regular credit cards before turning to student versions. (See chart below for the best of both.)

Don't co-sign...
"If you're old enough to have a credit card, you have to be old enough to be responsible for it," says Susswein. Adding your name to the application ultimately makes you responsible for your child's purchases.

...But do consider authorized usership
The low-credit limit that typically comes with a student's first credit card can also be the card's biggest pitfall if there's an emergency, says Bilker. If worries about Junior suddenly needing a plane ticket or a car tow are keeping you up at night, consider adding him as an authorized user on one of your (presumably higher-limit) accounts.