A penny saved is a penny made: handy tips on how to budget if you’re a college student
If you’re a student, you probably worry about making ends meet. And that is not my personal opinion – this is the fact proven by the National Student Money Survey conducted in 2016. The poll showed that about 80% of students worry about getting enough money to make a living.
Hopefully, you’re one of those lucky students who don’t have to work several hours a day to get by. Anyway, knowing how to budget is never a bad idea. For me, it was pretty surprising to find out that 1 in 4 students have never planned or tracked their budget, according to this 2016 survey I mentioned before. So I decided to share some handy financial tips for college students that will help you to handle money properly.
First of all, let’s talk a little bit about the budget and how to create it. You’re probably familiar with the concept – basically, budgeting means planning your spendings so that your income covers all the expenses. Ideally, you should be able to save some money every month, but we will discuss it later. So, let’s start with improving our budgeting skills!
How to set up a budget?
First, you need to list all the money you’ve got coming in every month. It may be a wage, a student loan, a scholarship or the money your parents give you. Extra 10$ from a friend who lost a bet to you also count! The next step is to keep track of all your spendings for a month. And by all spendings I mean literally every dollar you spend on coffee, snacks, and chewing gum not to mention rent, bills, food, and other crucial expenses.
By the end of the month, you just need to check whether these two lists of income and outgoings balance out or not. If you get more money than you spend – then you’re good to go! But still, you may use some money tips for college students below. And if your expenses exceed the income, you need to do something about it. Some students participated in the 2016 National Student Money Survey confessed that they had to drop out of college because of the financial problems. To avoid giving up yourself, try to put some of this advice into life.
There are only two ways to stick to the budget if you have troubles balancing it out – to make more money or to cut some spendings. The first one is obviously harder, but if you can’t live without a cup of Starbucks coffee every morning, getting a new source of income is probably what you want.
How one can make more money when studying?
- Get a part-time job but make sure that you really can balance between classes and work
- Apply for a student funding like a grant or a scholarship
- Generate a small passive income – for example, create your own site or start a blog
If you need some extra money right now, try to sell some clothes you don’t like or the textbooks you don’t need anymore. Similarly, don’t buy new if you can get, say, a student book or a smartphone from someone else for a lower price. Recycling is good not only for the environment but also for your budget!
For me, cutting some unnecessary costs seems to be more realistic than making a fortune from a newborn blog. Anyway, even if your posts are unbelievably popular and you’re rolling in money, getting rid of some money-draining things you could totally live without may still be a good idea. And please tell me how did you become such a popular blogger in a matter of weeks? =)
So, let’s finally get down to business. How can one save some extra money?
- I’d like to start with food. How often do you eat out? And do you cook by yourself? You can save a significant amount of cash making dinner all by yourself instead of going to the fast food restaurant next to the dorm. Fast food tends to be pretty pricey, not to mention that it’s not the healthiest choice.
- Don’t shop when you’re hungry. It may seem obvious, but how often do you grab a tasty snack just because you’re tired and hungry after classes? If you don’t have enough time to cook every day, prepare several meals for 2-3 days in advance.
- Examine your spendings and ask yourself: Do I really need to go to the movies every weekend? Can I live without two beers this evening? Spoiler alert: you definitely can, and if you reduce the amount of alcohol consumed, over time you will feel much better, not to mention the saving part.
- Being broke –or feeling that you’re close to being in the red – is a good time to quit drinking and/or smoking if you have those addictions. I’m not going to give a lecture on healthy lifestyle, I just want to say that your budget will only thank you for quitting.
- Try to save on transport costs. Get to the uni by bus instead of calling a taxi. If the college isn’t that far away, maybe you could take a walk once in a while? This will be good not only for your budget but also for your health.
- Finally, if you’re willing to save on clothing, try stocks and sales. There you will find new clothes at a low price so that you don’t go over budget. We need some pricey things like clothing, shoes, gadgets, course books, and other stuff, so save some money on such purchases as well.
There are a few more tricks that could help you to save cash. Use them to set some limits if you can’t help but spend all money you have in a matter of days.
- Pay by cash instead of using a credit card. That way you will feel actual money rather than a piece of plastic. It may help you to realize how much you spend and maybe make some changes to your financial behavior.
- Remember how your parents would give you an allowance once a week? Be your own sponsor and set allowance for every day or every week. And don’t you try to fool yourself – only you know how much exactly you could spend per month.
- Leave home with a limited amount of cash in the pocket – the money you assume you really need this day. This tip comes in extremely handy when you’re going to the party or planning a meeting with your pals. When the cash you have on you is over, you will have to come back home to your precious savings.
- Plan fun in advance. Whether you’re going to see a movie or have a coffee with your date, figure out how much cash you will need for the event. That also helps you not to overspend the budget.
Of course, don’t go too far trying to cut costs. I believe you should have some extra cash on you in case of emergency when you may need money right away. Having an emergency fund for such cases may be a good idea. Also, insurance is a great tool to protect your health and assets in case of flood, an accident, a sudden illness, or any other insured event. You may not have a fancy car right now, but it’s never a bad idea to be on the safe side.
Finally, I have one more lifehack for you. I’ve used it for a couple of years, and I must say it works for me! So, what’s the deal? Whenever you get any income– wages, scholarships, the money your parents give you – skim 10% off the top and deposit it in a savings account. With enough patience, you could save money on expensive apparel, a new up-to-date smartphone, or a holiday present your mom has always dreamed of. Anyway, having some extra money in your savings account never hurts, right?
So, I hope some of these money saving tips for college students will come in handy when you start creating a budget. And I highly recommend you to do that as soon as possible – unless you haven’t formed a workable budget yet. Then all you have to do is to stick to it, and you’re good to go. Budgeting is a skill that you will definitely need in your adult life. So the sooner you start improving it, the sooner you will learn how to handle money properly. And that is the point of the whole budgeting thing, isn’t it?