Managing your money while in college is one of the less pleasant tasks you’ll face that first year on campus, but it’s also one of the most important. Chances are this will be your first foray into responsible adulthood, and making sure your finances are in order is no longer your parents’ duty. Browse through our tips on managing your money while in college so that you don’t find yourself in trouble financially. You can cover the costs of your education while getting into the least amount of debt possible, and maybe have some fun while you’re there.
The basics of money management always include knowing how to budget. If you’re someone who likes making lists, keep a spreadsheet of how much money you’ll need and what you should be spending on all of your expenses. If you want more flexibility and to account for unknown factors like late-night pizza runs or car repairs, you may need to figure out another source of income besides your financial aid package and look for part-time jobs. If you’re lucky enough to have money left over once you’ve drawn up your budget, that extra money could be your personal expenses and emergency fund. You don’t need to sit in your room to be a smart spender and a smart saver, but a detailed budget will take you a long way toward keeping you from spending beyond your means.
Decisions Now Matter Later
That credit card with the low student interest rate may seem pretty appealing at first. After all, signing up now will get you a free t-shirt. But any decision involving opening a new line of credit should be approached with caution. If you already have one credit card, stick to the one, and use it for emergency expenses only. If you start pulling out that credit card whenever you don’t feel like eating off your school’s meal plan or to buy a pair of shoes you spied at the mall the other day, you could be in trouble once that first bill arrives and you’re only able to pay the minimum balance, or worse yet, you pick up a fee for missing a payment.
Too many college students rack up thousands of dollars in debt seemingly overnight, hurting their credit scores in the process. In 2009, Sallie Mae reported the average credit card debt load of graduating college seniors was $4,100 - a 41-percent increase from the same study conducted in 2004. A low credit score will follow you out of college, and could affect whether you’re able to afford major purchases post-graduation. A high credit score, on the other hand, will get you better rates on things like your car insurance, and will be crucial when you’re finally looking to buy a home. Check out our tips on managing your money and your urge to splurge while in college, and you’ll be graduating without the stress of debt many grads experience.