How to Manage Your Money in College
Whether you are joining an institution of higher learning or already in one, you need to learn how to manage your finances. At this point in your life, you have not started making any real money and your focus is on your studies and having fun. However, you should not use this as an excuse to make mistakes because they will follow you throughout your life. Here are some tips that will help you to manage your money better in college:
Create a Budget
College students should always budget their money to avoid borrowing mid-semester. Even if your parents are paying your full tuition, you need to have a budget. Of course, this does not mean that you should not have fun; just make sure that you budget for it.
You do not need to buy the latest iPhone or laptop to enjoy your life in college. You can get these things for yourself as soon as you land your first real job after college. You should set limits on your spending and stick to them if you want to learn some good spending habits. You can also opt for affordable housing options to save more money.
Student Loans
Although student loans will help you to pay for college, consider how much money you need. The more you borrow, the more you will have to repay once you get a job. Make sure that you explore all your options for lowering education costs. Tuition for private schools will add up quickly, which means that you might spend the first decade of your life after college paying off student loans.
To avoid this, you should look into colleges that offer scholarships. When taking out student loans, just remember that you will repay the whole amount plus interest. Moreover, these loans are not forgiven when you file for bankruptcy, which means that they will follow you around all your life.
Saving Money
When you are in college, you need to learn how to save money. Investing will not make sense if you are driving yourself deeper into debt by paying for your education. The most important thing that you can do is save for your yearly tuition.
Even if you are just working part-time, this money can make a big difference in the amount that you end up borrowing. If possible, you should also have an emergency fund. Although you might need to buy a car for getting around, you really do not need a condo or home.
Credit Cards
When choosing a credit card account, make sure that you choose the right one for college student needs: this is an area that most students make mistakes. If you are not careful, a credit card can wreak havoc on your life.
Do you even need to have a credit card to make it through college? You must ask yourself this question before you get a credit card. Many credit card companies try hard to get college students to sign up for credit to create customer loyalty. If you end up getting a credit card, you should try to understand how it works to avoid running yourself into a pit of debt.
While in college, you need to live on a budget. Make sure that you budget for any money that you put on your credit card. This will make it easier to pay off your credit card debt in full at the end of each month.
College is the time that most people look back on and remember the fun. Although having fun is not bad, you still need to manage your finances.
