Many college students are looking forward to getting back to campus to continue their higher education and resume their normal life post-pandemic. Whether you're a first-year student or well-versed in college life, understanding proper money management in college may help set you up for a more solid financial future.
Below, you’ll find a few money management tips every college student should follow. Using these tips can prevent future financial problems from ever arising.
Work in a Budget
When you were living with your parents or guardians, you likely had all your basic needs met through their care. This may have allowed you more freedom with the money you earned. Continued carefree spending may get you into trouble starting in your college years as you will not only be responsible for more of your own living expenses, but also likely responsible for the costs of college or student loans.
If you have not budgeted your spending, it is important to do so before you start college. A simple budget will do; be sure to include all of your expenses, loan payments, and savings, then create amounts to use for clothing budgets and entertainment. Try to then stick to your budget as closely as possible, so that you can try and meet your financial goals. Make adjustments if your income and expenses don't complement each other.
Limit Your Student Debt
When you apply for financial aid, you may be overwhelmed with the amount of money you will be given above your tuition costs. Often you are given additional funds to cover living expenses and supplies. It is crucial to remember that even though you are freely given this money, you will eventually have to pay it back—and may end up paying interest on it.
Always make sure that you spend your funds on essentials only. Don't use living expenses from loans for social outings, clothing, or vehicle purchases. Always make sure that you only borrow what you need. If you have extra money, pay back as much of the loans as possible during the grace period.
Take Advantage of Student Discounts
Being on a student budget is hard, and many businesses know this. Try to frequent places that provide you with a student discount, so you can save as much as possible on the things you need. Student discounts are found at almost any business, including restaurants, retail stores, and even entertainment venues.
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All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.
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