With the start of a new school year coming up, I wanted to share some posts with advice for students returning to college, or maybe going for their first year! It’s an exciting time, but it can also be a scary one for people doing it for the first time. It would have been nice to read some blog posts of encouragement and advice before I headed off! Last week I shared some lessons I wish I’d known when I started college. As you can see, one of things I wish I’d known was how to manage money when I started school. Here are a few tips for managing money in college so you don’t make the same mistakes I did!
Create a budget.
It will be a lot easier to manage your money when you know how much you bring in and spend every month. Tuition is typically due at the beginning of the school year, but living expenses are year round. This is especially important if you’re living in an apartment and pay rent monthly. Write down all of your set monthly expenses (rent, electricity, phone, etc) and try to make a rough budget for those expenses that vary every month like food, drinking, fun, etc. You might get financial help from your parents. If not, this budget will help give you an idea of what you have to make monthly at your job.
If you’re like me, you automatically accept whatever amount of federal loans you’re eligible for. It was great to have the extra cash in college, but not so great now that I’m paying it off. I wish I’d known a bit more about finances so I knew I didn’t have to borrow that extra money.
Learn to say no.
In college, there are infinite amounts of things you can spend money on. Going out to dinner, shopping, decorating your dorm, nights out at the bar, etc. But it’s important to learn that you don’t have to accept every invitation. Just a night out at the bar with friends can be expensive. Set a number of nights per week you’ll go out to dinner, out drinking etc. Stay in every other night and cook for yourself.
Don’t abuse your credit cards.
I didn’t have a credit card in college, and I think that’s the best scenario that could have happened. I probably would have left college with way more debt than I should have. It’s not that I don’t think college kids should have credit cards. It can be a great way to build your credit history. But just use it smart so it doesn’t end up hurting your credit score.
Look for student discounts.
Tons of stores, restaurants, etc have student discounts. If you’re going to be shopping anyways, you might as well find ways to trim the cost.
Don’t have a car if you don’t need one.
For most of college I had a job off campus and needed a car to get back and forth. But my first semester I didn’t have a car, and I was just fine without one. My mom was willing to pick me up when I wanted to visit home (it was only an hour away), and everything I could have needed was within walking (or bussing) distance. My roommate had a car in case I really needed to go somewhere. Car expenses such as insurance, gas and parking really add up. If you don’t need the extra cost, it’s probably easier not to incur it.
This is the biggest one! Learn to save as much as you can. I kicked myself for not leaving college with more money in the bank. There’s no reason I couldn’t have had more in savings. I worked my butt off through college, but I also spent a lot too. Not everyone gets a job right after college, and having that extra padding is nice. Even if you do get a job right away, chances are you’ll be making little money. Trust me, you’ll never regret saving that extra money.