In college, you need to start to assume greater responsibility for managing your money and creating good financial habits.
Follow our tips to create a strong foundation for money management that will serve you a good favor in the future.
How to spend money wisely: tips for students
- Set up a budget. To do it, just record all your income sources or a month, including your wages, parental allowances, and savings. Afterwards, enlist your estimated expenses. Of course, it won’t be easy, especially at first, but you need to do it to plan your budget. Make sure you have your meals, college supplies, as well as personal items among your monthly expenditures.
- Learn to tell apart your needs and wants. Analyze your expenses, and you will see how your needs and wants differ from each other. Then divide them into two different parts of your expenses. Set weekly cash allowance for yourself, first thing spend it on your needs and only then consider your wants.
- Set up a checking account. Banks often provide college students with free saving and checking accounts that help them avoid withdrawal fees. Find a bank that has a convenient ATM near your campus to get rid of the out-of-network charges. Also, you have to remember that when a transfer arrives from another state, it can take several days to clear. In this case, you have to check your balance and see that the money is there before you spend it.
- Use credit cards wisely. The International Journal of Business and Social Science says that 70% of undergraduate students have at least one credit card. On one side, it’s a good idea to begin building your credit history while you’re in college since you will need these records when you have to rent an apartment, buy a car, or find a job in future. On the other side, when you don’t have enough experience with handling finances, you can wind up accumulating a bulky debt on your card. If you don’t know the difference between building and overextending a credit, consult your business professor or another specialist. You just have to understand this difference.
- Analyze your loans. Figure out the exact size of your loan debt upon graduation and plan the ways you will pay it back in advance.
- Cut the cost of your textbooks. You may do it using many ways. For instance, purchase textbooks from a bookstore on your campus, download e-books on a Kindle or iPad, or purchase used books from older students or online.
Of course, college can be expensive, but you don’t have to finish it with a massive debt. If you know the basics of money management, you will handle your financial questions responsibly and learn a lot of lessons that will be useful in the future.