5 Ways To Manage And Save Money At College
Learning how to budget and how to be smart about money matters do not start when you receive your first pay check. In fact, the ability to spend wisely and to save can be developed at an early age. The best time for you to learn about sound financial management is when you are in college... and here's why.
First Semblance of Independence
Your parents will still support you financially, but you are on your own when it comes to budgeting.
College is the time when you will be living away from your comfort zone. Your parents will still support you financially, but you are on your own when it comes to budgeting.
You will experience first-hand how it is to pay your rent, utilities, and buy all necessities. There will be no adult stooping behind your back and telling you what to do. This means you must learn from experience the dos and don'ts with using your money.
This is even more important if you are supporting yourself through college. Without proper financial management, you might completely give up on education.
Here are 5 ways to learn the tricks of financial management:
1. How much money do you have and how much do you need?
Those are the first two questions you need to ask. They will determine how much you spend and what measures you need to take in order for you to become financially secure. For example, if you earn $500 a month working part time, decide if it will be able to cover your living expenses. If not, what would you need to sacrifice? Closing the gym membership and work out in the public park instead? Trading in your car for a motorcycle to help you get around? More than often there are cheaper alternatives that are just as effective.
2. Come up with a realistic budget and stick to it
You may need to cut some corners to make sure that you don't overspend or you only spend within your means. Don't feel sorry for yourself if you can't go out with your friends regularly. Saying no when you can't afford it will help strengthen your character. This goes for buying the latest clothing and gadgets as well.
3. Spend money wisely, especially when you are on student loan
Don't forget that you are eventually going to pay your student loan; so don't spend it on anything not related to your education. Even though sometimes you may fall into the temptation of purchasing certain items that you think will go towards your education, when in fact they lean more towards entertainment. This can include purchasing a new phone with the belief that it can help you organize your class timetable, when in fact you spend most of your time playing games on it.
4. Develop the habit of writing down your expenses
This is the only way you can track how much you spend on what and where your money goes. Having a list of expenses will allow you to weed out unnecessary expenditure. To make your life easier, there are also many websites and phone apps that can do this for you such as MoneyWise, Spendee and Mint.
5. Save, Save, Save
Start the habit of setting aside some money. Every time you receive your allowance or you get paid from your part-time job, set aside a certain amount before you spend anything. Don't fall into the habit of saving whatever is left after your expenses because there'll be none left. Considering saving half of your salary and only spending the other half.
Once you develop sensible financial management, you'll keep the habit throughout your life. No matter what happens in the future, you'll be prepared for the financial challenges ahead.
Do you have any other tips to manage your money at college? Let us know in the comments.