College Student Money Management
The Basics of Money Management for
The best college student money management advice starts with learning how to budget money and how to live frugally.
It can be a challenge to make good financial decisions during the college years. For many, college provides the first opportunity to live independently of parents who micromanage their daily lives. This new-found independence sometimes gives license to uncontrolled spending.
This is a luxury most students can’t afford because of the high cost of education and a limited supply of income. Students must be disciplined in their spending habits to make sure that their money covers their expenses. The easiest way to do this is by developing a budget.
College Student Budgeting
College student budgeting starts with projecting income and expenses for a period of time, often a semester. A personal budget worksheet is a great tool to use for this. It allows you to plan for several categories of income and expenses. Once developed, the college student budget is easy to maintain by using the envelope budget system. Using this method, cash is put aside in envelopes to be used for specific purposes.
How to Live Frugally
Once the budget is in place, the next step in money management for college students is to learn to live within their means by spending less than they earn. The college years are a perfect time for a person to learn how to live frugally. In order to do this, it is essential to distinguish between need vs. want.
College Student Money Management Tips
- If you have student loans, take them seriously. Recognize that they will be with you for a long time. You will be expected to pay them back whether or not you have a good job. Don’t do anything that would needlessly add to your debt.
- Don’t use credit cards. If you need to use plastic for convenience, use a debit card. Learn why excessive credit card debt has profound long-term implications.
- Keep organized. Develop a system for paying your tuition and other bills on time. Balance your checkbook to avoid writing checks that bounce. Little mistakes can be expensive in late fees and interest charges.
- Cut the cost of your textbooks. Share with another student if possible. Buy used books from other students, the campus bookstore, or online.
- Use the benefits of your campus to the fullest. If you have a meal plan, make sure you eat every meal which you have already paid for on campus, rather than going out to eat. Use the college’s recreational facilities and fitness equipment. Attend campus activities for entertainment.
- Spend as little as possible off campus. Find thrifty, fun things to do. For those occasional times that you go out to eat, find ways to save on eating out.
- Don’t bring a car to campus unless absolutely necessary. A car costs money to run and usually leads you to spend more money off campus.
- Find other students from your home area with whom you can carpool back and forth for breaks.
- Consider working at a campus job. Some jobs may even allow you to study while you are working. Also, always be looking for extra ways to make money.
If you follow these college student money management tips, you will not only save money during your college years but also develop good habits to help you manage money throughout your life.
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