College Finance: Back to School Edition

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    Think of all the exciting moments that lie ahead of you – create memories, make lifelong friends, and open up a new world of learning. In the whirlwind one quickly loses sight of some important components. Managing the finances during this time is vital. The more you have in place now, the more it will save you from a world of grief in your later adult years. Read on to find some effective, yet simple ways you can make your money work for you while you are at college.

    Spend your loan repayment wisely

    If you need to take advantage of private or government funding, please keep one thing in mind: The excess money that is allocated to you each semester is not “free” money. This is simply an overpayment to you once all of your school expenses are paid in full. If you need to use this money for personal reasons, be sure to stick to an allotment so as not to spend more money than necessary. To avoid any temptation, you can return the remaining balance either to a parent / legal guardian or directly to the loan provider. Both can ensure that the money is no longer in your hands to avoid unnecessary expenses and interest later.

    I know that eating out with friends, spending money on online shopping, or enjoying a casual road trip can look attractive. While these are all memories worth living, in more than four years a few hundred dollars can quickly become thousands over time with interest. Start the tough (but necessary) process of saying no to yourself from time to time. I get it; Denying yourself something isn’t the most glamorous feeling. However, if you develop this habit at a younger age, then average muscle gain will result in adulthood and beyond.

    Look for ways to generate additional income

    We never said college was all work and not a game. So that you can have as much fun as your heart desires without spending too much money, think about different ways to earn some money between your studies. Many colleges and universities have working study opportunities – programs that allow you to work on campus and make money in the process. This is the most practical solution as there is often no need for transportation as everything is centrally located on campus.

    If you’re looking to find external employment, a quick search on online job boards will give you an instant view of who’s hiring. Make sure the employer knows you are a college student, so your schedule should easily match your school requirements. Remember, don’t overwork yourself to the point of exhaustion. While the nights will be endless, at this point in your life it shouldn’t come at the expense of a job. Excellence in studies is the most important task!

    Let’s not forget – this is a digital age. If a dual course of study or a classic part-time job doesn’t sound too attractive, think about products / services that you can offer virtually. Freelance work is always an option for a writer, photographer, or any other creative person by nature. Think of skills that you take for granted or skills that you want to build and improve over time. This is a great way to spice up your resume while making some money over the weekend. The ways to make money are limitless – use your growing network and let it work for you!

    Create a light budget and stick with it

    A budget is not meant to stifle your fun, it is simply set up to provide some guidelines for your spending. Hopefully the number of financial obligations you have right now is minimal. This is an ideal time to start creating a budget that doesn’t give up on basic goals like saving or investing. If you’re not sure how your money is being distributed, use the Mint app for a holistic view. From there, you’ll see how best to adjust your budget. If you’re responsible for bills like phone or car insurance, these should be at the top of your budget. After that, focus on opening a savings account for emergencies like car repairs. The goal is to be prepared no matter what.

    Save as much as you can

    Saving is not just limited to what older adults do – it is a vital practice that should be implemented as early as possible. Not only does it help avoid panic in an emergency, it also provides general security. Since saving will look different for you this season, use your budget to determine how much to save while meeting all of your necessities. Set a set amount and commit to saving it based on what works for you; this can be weekly, bi-weekly or monthly. Develop this good habit now so that you can master it in your final years. While taking a break from class in winter and summer, earn as much as you can to ease the pressure when classes are intense.

    Avoid credit card debt whenever possible

    While it’s important to build up your credit during this time, going deep into credit card debt without a reliable, stable income isn’t ideal. The best rule of thumb for credit cards is to top up small amounts that you can pay off in full when you buy. This can be gasoline or a reasonable number of groceries. As you practice this you will become very aware of how your funds are being used. as well as the development of a positive credit history.

    Only make interest payments on your student loan

    I know this means nothing to you (now) – strongly consider paying interest only while you are in school. While you are a current student, no interest should be accrued during this time. While repayment options vary depending on the terms of your loan, help your future self by throwing all the money you can to reduce your debt.

    Author's photo

    Marsha Barnes (22 posts)

    Marsha Barnes is a finance guru with over 20 years of experience committed to empowering women worldwide to be financially successful. Financial literacy and education are a passion for Marsha, providing practical information for clients that will build their overall confidence in their personal finances.

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