PayPal just officially launched its Student Account program, a way for parents to give money to their kids -- and track where it's going every step of the way.
Parents can open a PayPal account, then establish up to four PayPal sub-accounts for their kids (ages 13 and up) , transferring funds into those accounts when needed on a one-time or recurring basis. Kids can use the account online, or get access to the funds via a MasterCard debit card to spend in the real world.
Besides giving money, parents can also see where it's going. You get full visibility into your teenager's account balance, spending habits and budgeting skills. You can set permissions for how the account can be used, and can also require that your approval is required when a kid receives money in the account.
Parents can use a PC or cell phone to check account balances, transfer money, and get alerts when the kids' payments exceed a certain amount or when a specified low balance is reached
This could be a good thing. You could help your kids learn how to budget and spend money wisely at an early age, and make sure their allowance isn't being spent on beer and online gaming.
On the other hand, you could go too far on the Big Brother aspect and annoy them by prying too much into their spending history. Monitoring their transactions may be tempting, but if you put some trust in your kids' money judgment, this could be a good way to send them out of the nest with a better sense of financial matters.
Another good feature reportedly in the works: Pay Pal plans to integrate money made from the teen's part-time job into Student Accounts, so their own hard-earned money mingles with your own.