Managing Money while in College
You’re off to college, starting a new chapter in your life. Whether you’ve received a sports scholarship, a student loan, with the financial help of your parents, or by working your way through tuition and other fees, you need to manage your money.
Managing your finances might be the last thing on your mind, but it’s crucial if you want to finish college debt-free, or avoid an unnecessary financial crisis.
Make a Budget
Of course, you’d rather go out with friends than sit at home and create a budget. However, starting to budget now will help you later. Do you want to finish college on a strict peanut butter and jelly diet because you can’t afford anything more? If not, take an hour to make a budget.
Budgeting doesn’t need to be complicated. Simply write down your monthly income versus your monthly expenses. Once you’ve accessed your recurrent ins and outs such as rent and your phone plan, keep additional receipts and take a few minutes each week to add them to your budget.
After a month of doing so, analyze the numbers. Do you spend more than you earn? Can you cut some expenses? Do you need an extra source of income? Doing this early on helps to avoid getting into debt.
Don’t Spend More Than You Make
Don’t spend money you don’t have. Spending more than you make gets you caught in the endless wheel of credit cards and loans, and you’ll regret it before your college years are over.
Get a Job
Working while in college has its pros and cons. Having a job leaves you with less leisure time, and you also need to be careful that it doesn’t infringe on your study time.
On the other hand, having the extra money stops you from relying on credit, so you have fewer debts. You also learn how to manage your time and money better, which prepares you for “real” life once you finish school. A job also helps you get ahead of your competition once you finish school since you will have some work experience.
Plan in Case of an Emergency
Of course, emergencies do happen, and you never plan for them. When one occurs, and you don’t have enough savings to deal with it, talk to your parents. They’re usually more than happy to help out. Agree on a payment term and put everything in writing.
If your parents are unable to help, check with your bank about a small credit card or loan. They might refuse if you don’t have enough credit history. In that case, if you have a job, you can apply for a short term loan. Online loans can be pricey, especially if the loan isn’t paid back in time, but they are very helpful when there is no other solution.
Stay on Top of Your Finances
You have your whole future ahead of you. Don’t ruin it with debt. Learn to manage your money now, so that when you get out of college, you will have a bright, debt-free future.
