Being able to manage your finances while in college is incredibly important. Let us help you get started with these 15 helpful financial tips.
Did you know that the cost of college has tripled in the last 20 years?
Financial stress can be a significant weight on students, especially when they are also supposed to be keeping up with academics and enjoying the exciting pace of college life.
Between tuition, housing costs, transportation, materials, etc., the average college student spends thousands of dollars each semester for their education. That is a lot of financial responsibility, especially considering that the average first-time college student is only 18 years old.
So, if you are a college student looking for some financial tips to graduate debt-free, you’ve come to the right place. Keep reading for a complete guide on college financial advice.
1. Apply to Scholarships
There are thousands upon thousands of scholarships available for college students. Although some of them are awarded for academic excellence, many out there don’t require you to have a perfect GPA and a million extracurricular activities to be eligible. There are scholarships for minorities, athletes, artists, etc.
Most scholarships are highly competitive, so applying to as many as possible is always a good idea to increase your chances of receiving scholarship money. If you don’t know where to start in your scholarship search, you can always reach out to the financial aid office at your school and ask for assistance. Your school might also have some scholarship money available, so reaching out to them could give you more options.
Paying for college with scholarship money can help you avoid getting high-interest loans and relieve some of the financial strain of paying for college out of pocket.
2. Apply for Financial Aid
Before each year of college, you should fill out a FASFA form to be considered for federal grants and aid. Students get financial assistance on a need basis, so filling out this form is essential to know how much money you can receive. Even if you don’t think you can get money, you should still apply early every year.
Applying for both financial aid and scholarships will increase your chances of reducing your out-of-pocket costs for college. Lowering your tuition will significantly reduce your financial stress and make it easier for you to focus on your academics and career goals.
3. Create a Budget
Creating a budget is a fantastic way to make financially responsible decisions during college and after graduation. Sticking to your budget will help you avoid overspending and make it easier to know precisely what you are working with regarding your finances.
There are many ways to create a budget- an excellent example for college students is the 50/30/20 method. With this method, you’ll assign 50% of your income to necessities and essentials such as food, rent, tuition, etc. 30% of your money goes to lifestyle expenses (subscriptions, entertainment, etc.), and 20% goes to your future (savings, investing, retirement, etc.)
You can also adopt the idea of the 50/30/20 method, but change the numbers so that they work for you. Whatever method for budgeting you choose, it’s crucial that you stick to it.
4. Get a Job
Scholarships and financial aid are great ways for college students to get money. However, getting a job to finish paying the rest of your tuition plus all of your other lifestyle expenses is essential. Even if a grant or aid covers housing and meals, getting a job will allow you to have some money for extracurriculars and savings.
There are plenty of jobs that accommodate schedules for college students- you might even find great employment opportunities at your school or paid internships in your field of study. This will give you experience for your resume and more financial freedom while you finish school.
5. Be Aware of Your Spending Habits
Tracking your expenses is a great way to stick to your budget and get a clear idea of where you tend to spend your money. It is easy to get carried away with “wants” in college and forget to prioritize your “needs.” Tracking your spending will give you an idea of what items you could cut should you need to save some extra money for essentials.
Perhaps you like to buy coffee on the way to your classes instead of making some at your dorm, or you’ve been ordering takeout way too much. Knowing these habits will make it easier for you to adjust your budget and make you more aware of your daily expenses. Of course, it is okay to treat yourself every once in a while, but it is essential to be mindful and as financially intelligent as possible.
6. Establish Credit History
It is never too early to start building a good credit score. You can start simply by applying for a credit card as a college student and use this method to establish history without temptation:
- Use your credit card for one or two recurring subscriptions only
- Set your card for auto-pay
- Put your card in a drawer
Doing this will allow your card to have constant activity and build history without you having to worry about it. Just don’t forget to set auto-pay it, cause forgetting one payment can do a lot more harm than good.
Establishing a credit history and keeping up a good score will help you enter the workforce a lot more prepared. If you start building your credit as a college student, you’ll have an easier time getting a mortgage on a house, car leases, bank loans, etc., once you graduate and feel ready to take those next steps.
7. Use Credit Cards Responsibly
Although getting a credit card is a fantastic way to build a credit history, it is important not to feel tempted to overspend. Because credit cards often feel like “free money,” it can be extremely easy to buy things you can’t afford and end up in debt. However, you must remember that a credit card is a loan.
Make sure to do some research and figure out what credit card would work best for you and your current situation. If this is your first card, you should begin with an account that has a low limit so that you don’t feel tempted to make big purchases you can’t afford.
No matter what card you sign up for, it is imperative to read the full terms and conditions agreement to understand precisely what it entails to have that card. In addition, you should always make your payments on time and avoid making big purchases if you don’t have the money to back them up.
8. Save Money
If, after covering all of your expenses, you still have some money left over, consider setting up a savings account or start investing. Even a couple of extra dollars a month can help you build an emergency fund that you can access on a rainy day.
Saving money is a great habit to establish early on. You can even include savings within your budget (like the 50/30/20 method) so that you make it a priority to always put a little money away for your future.
9. Cut Unnecessary Expenses
A great way to save some money and avoid overspending is by removing all the expenses you can live without. Perhaps you have a subscription that you don’t use that much, or you constantly go to restaurants instead of cooking at home or your school’s dining hall. Whatever it is, you should take some time each month to examine your list of tracked expenses and cut out the ones you deem unnecessary.
Saving a couple of dollars from things you don’t need anyways will allow you to have some extra cash for the things you genuinely want or need.
10. Take Advantage of Campus Facilities
Besides offering academic classes, colleges often have a lot of incredible facilities and resources available to students. The best part? These things are usually included in your tuition, so you don’t have to spend extra money on them.
Using your campus facilities can help you save money on things like gym subscriptions, health clinics, etc., which can get expensive if you had to pay for it out-of-pocket. Make sure to do some research and see what your college offers- you’d be surprised by the number of resources that might be available to you.
Some colleges even offer mental health resources, workshops, and entertainment activities. Take advantage of them and save some money in the process!
11. Get Roommates
If you don’t plan on living in a dorm, you should consider getting Apartments for rent in Glendale with roommates.
Rents can be costly, and rooming with a few people can significantly reduce your living expenses. Besides, living with like-minded people will also enhance your college experience.
12. Don’t Buy New Textbooks
The total for college textbooks can be over $1,000 per year. This is a lot of money considering that students can always find used books for a fraction of the price. Buying new textbooks is an unnecessary expense that can weigh heavily on your semester finances.
Another option to save money on books is renting them or getting them in a digital format. Both of these options tend to be more affordable and will save you a lot of space in your dorm or apartment as well.
13. Use Coupons and Student Pricing
If you are in college, you should always ask for student discounts if you plan to make a purchase. Many restaurants, venues, museums, etc., offer incredible student discounts that you should always take advantage of. You can even get these discounts for certain technology and other supplies you might need for school.
All you’ll need to claim your student discount most of the time is a valid school ID. Discounts will range from place to place, but they are a fantastic way to save some money while enrolled in school.
14. Only Get Loans as a Last Resort
Student loans often come with very high-interest rates. This is why many students graduate from college with significant debt. Graduating without student loans is the best way to begin your career in good financial standing.
So, if you have the option of avoiding student loans, you should. Always look into scholarship opportunities and financial aid first, and determine if you could pay off the rest with a family contribution or your own money.
There are over a trillion dollars of student loan debt nationwide. If getting a loan is necessary, fully understand all of the loan terms and do thorough research to make a well-educated decision.
15. Focus on Paying High-Interest Debt First
College comes with many expenses, so if you end up graduating with some debt, make sure to pay it off as quickly as possible so that you don’t have that weight on you for many years. Perhaps you have a few credit cards, a personal loan, or you couldn’t avoid getting student loans.
There are many different approaches to paying off your debt, but an excellent way to tackle it is by prioritizing paying off your high-interest loans entirely first. This way, you’ll be saving more money in the long run cause you’ll be paying fewer years of high interest.
Looking for More Financial Tips?
College is a fantastic experience that can help people grow and achieve their professional goals. However, it is also expensive, which can be a massive weight on those who don’t have a grip on their finances. If you are already in college or planning on going soon, following these financial tips will help you get rid of some of that money-related stress.
Remember to make a budget and stick to it, get a job, and try to fund your college experience using scholarships and financial aid money.
Are you looking for more financial help? Make sure to check out the rest of our content!