When a student is in college, his or her priority is not always managing money. His or her priority is more commonly based on having fun and studying. Despite this, students need to start considering making smart financial decisions, so their mistakes do not follow them into their careers. There are five areas that students should begin practicing good financial decisions.
Budgeting: Every student should outline a budget that works for them and try to follow it to the best of their abilities. It is okay for the student to plan out moments when fun is allowed in the budget as well. This will assist him or her in moderating the spending. It will also further develop healthy habits regarding spending. Another item to consider in one’s budget is affordable housing and utilities.
Saving Money: Saving money follows the last point of budgeting naturally. Saving money in college is a little different than saving in the real world, though it should still remain at the top of one’s financial priorities. A student could save money towards tuition expenses, for example, to avoid school debt. It is important to have an emergency fund as well just in case there is a medical emergency or another emergency.
Student Loans: In some regard, student loans are inevitable for most students. It is important for a student to find ways to lower how much he or she borrows, however. A student could consider schools where he or she was offered a scholarship or a school with in-state rates, for example. Student loans will be an ever-present force, even after graduation.
Credit Cards: Credit cards are one of the biggest mistakes students make. They are not necessary for a student in college and can cause more harm than good. If a student has a credit card, the payments should be included within his or her budget. It is important to pay off credit card balances quickly and in full monthly.
Employment: Finding a good job in college has many advantages for a student. For a start, it will help to build a student’s resume, especially if a job is found within his or her field. There are benefits from working, including insurance and tuition, if it is a work-study position. Overall, the money earned will help with saving and managing money better. It will also assist a student with the transition from college to the real world.