8 Financial Tips For College Students
Starting life as a college student can be challenging, especially if it’s your first time to take up financial responsibility. While you may have learned some things from watching your parents, there are still more than a few temptations that can lead you astray. And since you’re trying to get your bearings with a more challenging course schedule, the financial problems can sneak up on you. To assist, we’ve put together this list of financial tips for college students like you. Let’s get started.
1 Try budgeting for 90 straight days.
There is a saying that to give anything “a try,” you have to do it every day for 90 days. If you can’t turn it into a habit in that period of time, then you may need to find another way. That said, try to make and live by a budget for a solid three months. By repeatedly weighing your income versus expenses and keeping your spending to within those limits, you will start to habitualize responsible spending and saving habits.
2 Don’t rush into an expensive undergraduate school.
Many college students make the mistake of thinking that they have to jump right into a full-scale university complete with sticker-shock price tag. This is completely unnecessary. For starters, the first two years of any degree program are always comprised of general education requirements. That means you’re getting the same caliber of education whether it’s at Yale or at a local community college. It simply does not matter where you get this work done, so don’t pay a premium price for it! Remember: the financial issues that you experience when you get out of college have everything to do with the choices that you’re making now, so make a good choice by forgoing expensive undergraduate work for as long as you can. Recommended course of action: do your first two years of undergrad work at a community college, your last two at a cheap 4-year state school, and anything beyond that at a more prestigious institution.
3 Never buy anything on credit you can’t pay off in 30 days.
Credit card offers abound when you’re a freshman in college. Unscrupulous companies offer you the promise of heavy spending plastic — not to mention a free T-shirt! — in exchange for a 20+% interest rate. Since most college students at this stage are captivated by the increased spending power, it doesn’t take long to buy something expensive and watch the principal debt grow and grow and grow with each monthly payment. Instead of using your credit card to buy things in college, leave it alone unless you can afford to pay off the entire purchase in 30 days or less, thus forgoing any interest paid for the billing period. Now you might be asking from this: then why bother with a credit card at all? Good question. If you can’t be responsible with it, then you should leave them alone completely. For those of stronger will, though, they can be great for establishing strong credit, which will be of use to you later in life.
4 Work, at least part-time.
Many students see college as a four-year party. Most of those individuals, however, do not make it the full four years, let alone through graduate school, because they are dropping out my midterms. Don’t be that person. You don’t have to go through school and not have any fun, but a job will help you temper the amount of fun you have with a healthy dose of responsibility. It will also put extra money in your pocket and help you establish a sensible budget.
5 Take advantage of freebies while you can.
When you’re a college kid, people are always offering up freebies — free lunches, free movie nights, student discounts. Take advantage of these perks for as long as you possibly can because you’re probably not going to see anything else like this until you’re eligible for AARP.
6 Don’t pick a major based solely on passion.
What does picking a major have to do with financial tips for students? Everything. How you choose will ultimately determine your earning power, and could even play into the amount of money you end up owing in student loan debt. A doctor, for instance, could amass hundreds of thousands in loan debt while an art teacher may graduate only owing a few thousand. While passion is important to have, don’t let it dictate what you select as your major. Choose something with a clear future.
7 Don’t believe passions require a degree.
On the flip side, you shouldn’t assume that all your passions require a degree that specializes in them. You can still chase your passions, in other words, with a degree in something more lucrative. I know one person, who always wanted to write professionally but went into accounting because he thought it would pay better and offer more job stability. He was right on the job stability part, but he’s actually earning more now than he did as an accountant, simply because he queried a few places that were looking for blogs and articles about finance. They’ve never checked his credentials, and he’s convinced he could have gotten this job just as easily had he majored in English. He’s gotten where he is today because he was a self-learner and he kept pursuing his passion — to become a freelance writer — in his spare time. Today, he’s expanded his reach to movies, men’s products, and sports, all without choosing a major that would lock him out of the job market.
8 Learn to pool resources as much as possible.
Spring break trip? Gather up as many friends as you can and split the cost of hotel and gas. Moving off-campus? Get a couple of trusted roommates. Don’t assume you will be unable to do what you want; just be smart about it by building a group that you can enjoy things with.
Which of these financial tips for students do you think will be the most difficult to upkeep? Sound off in the comments section listed below.
[Image via Fewings.ca]