For the most part, when we think about college we think freedom and fun. However, there is nothing fun about daily stressing over your finances and there is no freedom in being chained to an ever-increasing pile of debt. Money management will help you avoid these stressful situations. You're going to have to start sometime in your life and it might as well be today.
What college students should know about managing their money:
Money management is generally done through creating a budget. Budgets help you form a realistic plan for spending your money. Due to the fact that your income and expenses are always fluctuating, whichever budget you decide to use needs to allow for flexibility.
The first step you'll want to take is writing down your sources of income. This usually consists of income from a job, grants, scholarships, allowance from home, etc. The second step you should take is writing down all your expenses. Split them into two catagories: fixed and flexible.
Fixed expenses are exact amounts due on a specific date that don't change. Flexible expenses are ever changing amounts of money that you spend on your wants and needs.
Example Fixed Expenses:
- Rent
- Car payment (including insurance)
- Health insurance
- Tuition
- Cell phone
Example Flexible Expenses:
- Books and various school fees
- Transportation
- Going over on your cell phone minutes
- Social expenses (movies, dates, football games, etc)
- Personal expenses (clothes, groceries, doctor and/or dentist bills, haircuts, etc.)
Calculate all the income and expenses you have. Look at your paper. Do you have more expenses than your income can cover? If this is the case, figure out how you can increase your income or decrease your expenses (or a little of both). This process is simple but necessary if you want to stay out of debt while you are attending school.
Lowering your expenses will probably require some sacrifice. Many college students are used to impulsive spending. This kind of money management will lead to financial bondage. If you are ready to lower your expenses try some of these tips:
- Pay all your bills on time
- Stand against peer pressure
- Buy used text books
- Shop at discount stores
- Use coupons
- Stop eating out and buying junk food
- Share an apartment
Everybody is going to need a different type of budget to fit his or her individual needs. However, basic budgets can be found all over the internet, in financial books or just ask your parents or friends to give you some ideas. Do not allow debt to chain you down. Form a budget, stick to it, and be okay with sacrificing a little to stay out of debt.
NOTE: Use of this article requires links to be intact.
To learn more about money management please visit the
Managing Student Debt page. Being a college student herself, Elise Fisher loves writing articles to help college students learn more
About-Student-Loans.
