It’s a great time for you to learn about financial management and develop habits that will set you up for financial success throughout your entire life. You can set bigger goals by being more clear about your spending and saving habits.
Although the primary focus of the college is to get a high-quality education, it also offers the opportunity to learn the money skills that you will need once you graduate. To build a strong financial foundation for the future, you should make smart decisions about your money. This means that you need to be financially educated now.
Too many students graduate in the red and face difficult financial decisions when they’re just starting out.
Learn 10 money management tips to help college students get on the right path and leave college with a good financial record.
1. Set a budget
It is essential to learn how to budget and set financial goals for college students. It may seem daunting to plan a budget after a long day of studying, exams, and other obligations. It is possible to make it easy.
Personal finance is made easier by a college budget. You can track your spending habits and create a budget to see where your monthly income is going. You don’t have to live on a budget, but it does mean that you can still have fun and pay the bills.
Think about the monthly living expenses that you are responsible for. Begin with the basics: tuition, room, and board (or rent, utilities, if you live off-campus), books and class supplies, phone payments and insurance (or public transport costs), haircuts and toiletries, as well as food. You can be sure that your priorities will be met once you have a plan in place.
A college student budget is a way to manage your monthly expenses. It’s also a great way to develop good financial habits.
2. Track your expenses
It is the easiest way to keep track of your finances. You can cut back on spending or make more money by regularly looking at your finances. You may not be aware of how much small purchases can add up until you look at your income, and your expenses.
It is easy to create a budget, but sticking with it can be difficult. Next, track your expenses using an app like Mint, or on paper. This will allow you to compare your actual-world experience with the budget and make adjustments if necessary.
It is important to track expenses by date. If you have $120 budgeted for your monthly food budget, but you use it up in 2 weeks, then you will need to adjust. Also, save some money for an emergency fund. You may need a taxi, urgent academic “pay someone to write my research paper for me” help, or medicine. If you’ll not plan it, you’ll be out of budget earlier than your income will be.
Another reason to be vigilant about your expenses is that you can spot fraudulent charges early on and get help from your bank to reverse them.
You have many budgeting apps to choose from. To quickly see where you might be spending too much, you can get in the habit of entering your weekly or daily spending.
To help you keep track of your money and stick to your budget, check out apps such as Wally, Mint or Acorn.
3. Open a savings account
This is a common problem for many people. It’s important that you start to develop this habit as soon as possible. Although it’s tempting to spend first, then save the rest, you will end up spending more than you save. Instead, pay your bills first and then contribute to your savings. Then, you can spend a little more on yourself.
Warren Buffet said, “Don’t save what you don’t spend after spending. Instead, spend what you have after saving.”
Once you have established your budget, you can start to identify areas that you could spend less on and help you save money for your long-term goals. These are some ideas to help you get started.
If you are not able to afford a meal plan, you might consider switching to one that is less expensive.
- You can rent or purchase used textbooks rather than buying new ones at the bookstore. You may also find cheaper options for course materials at your college.
- You may need new tech to teach class if you are in dire need.
- You can walk, bike or take campus transportation instead of paying for fuel.
Budgeting and saving, like many other things in life take practice and time. Don’t be discouraged if you make mistakes or go over budget from time to time. There are ways to make changes and get back on track. Keep your eyes on the goal of building financial habits that will last a lifetime.
4. Build your credit score
Everything, from renting an apartment to purchasing a car to buying your first home, will be affected by credit scores. There are many options to improve your credit score.
Consider making small payments of $25-50 if you have student loans. This will help to reduce interest and establish a positive repayment record.
To build credit, the best methods are to pay on time and only borrow what you really need. Credit Karma also offers a free credit report check.
It is important to understand the factors that affect your credit score and FICO score, and what you can do about it. This will help you control your financial future. Credit card debt should be avoided. Many college students have taken advantage of credit cards to get easy money and created a debt problem they cannot pay off.
This is because cards can be difficult to use when you are just starting out, and you don’t want to have to learn fees and interest the hard-way.
Students may choose to limit the amount of credit they use for one expense, such as textbooks or gas to get to school.
You can avoid interest charges by making small purchases and paying the balance in full. This will give you a boost to credit.
Compare credit cards to find out the APRs, fees and other options. Reputable companies can be recommended by websites like The Points Guy or Consumer Reports.
A student credit card can be a great way to start building credit. While building credit may not seem important while you are still in school, it is essential for future financial goals. Your ability to rent an apartment or get a job can also be affected by your credit score. Here are the top credit cards for college students.
5. Cooking on a Budget
Adults have to live within a food budget. You must eat, no matter your age. There are many ways to feed yourself, and your bottom line will be affected by the choices you make.
It is a skill and an art to learn how to cook on a tight budget. It can be difficult to find the right balance between making delicious food and keeping it affordable. However, it can also be fun.
You’ll save money by having a few easy, delicious recipes for dinner.
You can browse food blogs or recipe sites such as Serious Eats and Allrecipes.com and look through the recipes and view how-to videos. You can also find classic Julia Child videos on YouTube, or tune into the Food Network