Managing your money while in college is not easy, especially during your first year on campus. However, money management is extremely important because your finances are no longer your parents’ responsibility. Browse through our tips on managing your money so you don’t end up in financial trouble. With these tips, you will learn how to cover education costs with minimal debt, and use the money you save to have fun in college.
Knowing how to budget is crucial to avoid debt. Know the cost of all of your expenses, including an emergency fund for things like food and car repairs. Calculate how much money is left over after your basic expenses. Use that for fun money, and keep track of how much of that money you spend. If you need more than what is in your financial aid package consider picking up a part-time job. Never spend beyond your means. Maintain a tight budget to avoid financial stress, and keep couple bucks in your pocket at the end of the month.
Decisions Now Matter Later
Although credit cards with low student interest rates are appealing, be cautious about opening a line of credit. If you have your own credit card, do not apply for another and only use your card for emergency purposes. Sign up for a meal plan to avoid unnecessary food purchases and do not buy those extra pairs of shoes. If you carelessly swipe your credit card, you will be unable to make payments which will rack up interest fees and ruin your credit score.
Overnight debt occurs when students abuse their credit card. In 2009, Sallie Mae reported the average credit card debt of graduating college seniors was $4,100, a 41% increase from 2004. High debt equals low credit score. A low credit score will prevent you from making important purchases post-graduation, such as a car or leasing an apartment. A high credit score will enable you to sign a lease, and get better rates on cars, insurance and a home. Check out our tips on managing your money to avoid the urge to splurge in college, and keep a high credit score.