Stepping into college, I was all prepped for the typical college lifestyle: classes, part-time job, and of course, the parties. However, what took me by surprise was the challenge of financial management as a student. All of a sudden, you’re independent, armed with a credit card and left to navigate the financial wilderness on your own.
While it’s enticing to splurge your money on trendy clothes and drinks, the truth is, adopting sound financial habits as early as possible will pay off significantly in the long-term. It’s possible to enjoy youthful carefreeness without sabotaging your financial health. These are some money-saving strategies for college students I wished someone enlightened me with when I started college.
Settle Your Credit Card Balances Fully
Don’t misconstrue your credit card as an inexhaustible source of funds. Ultimately, the borrowed money has to be returned. It’s not my suggestion to entirely avoid owning a credit card, it is, after all, a convenient way to build credit history. However, ensure to clear your card balance every month. One financial hack I still find useful is settling my card’s charges daily or weekly. I utilize my card often to accrue reward points, but promptly offset the expenses from my checking account. This way, I can earn points without plunging into financial chaos.
Student Loans Aren’t Free Money
Often, I would receive checks amounting to several hundred dollars from my university, an excess from my student loans. Looking back, I regret not using that money to offset my loans. By the time I fully repaid my loans, almost seven years post-college, the accumulated interest basically meant paying thousands more. I advise you to only apply for the minimum student loan you can afford.
Start Working
By working while in college, you’re essentially preparing yourself for the post-college world. It’s wise to work full-time during summer breaks to save up for textbooks and other essentials. A good saving strategy is to save half of your earnings, spend half. Most likely, your expenses are minimal at this stage, save as much as you can to cater for college-related costs. This puts you at an advantage compared to peers who graduate swamped with debts.
Opt for Used Items
Whenever possible, choose used items. This refers to not only books and supplies but also everything else. Need a car? Buy second-hand. Clothes? Thrift shopping is your friend. Furniture? Try buying from an outgoing senior.
It’s worth noting that college might be the last chapter in your life where your appearances aren’t overly scrutinized. Driving an older-model vehicle or wearing pre-loved clothing may not be the coolest situation, but the financial freedom you’ll gain from avoiding unnecessary payments is priceless.
