The toughest math test for many college students is making their money last through each month. That’s why living on a budget is so important. With plenty of bills and limited time for work, cash is tight for almost every student. Thankfully, with these ten budgeting tips, you can make your money go further and build financial habits that pay off for a lifetime.
1. Write a budget down and track your spending. This important step produces a clear view of exactly where your money goes, revealing spending habits you’d miss otherwise. Our free budget worksheet is the perfect way to start.
2. Set cash aside in envelopes. If you budget $50 per month to eat out, put $50 cash in an envelope. When the money’s gone, you’re done spending in that area. This old-school system provides spending control that debit and credit cards can’t match.
3. Limit entertainment spending. Don’t be tempted to pull out extra cash for things like entertainment. With a little creativity, you can make your dollars stretch. Limit your ATM visits and look for free or discounted events on campus.
4. Set up direct deposits/transfers. Many employers let you designate portions of your paycheck to specific bank accounts. If you can’t allocate that way, set up an automatic transfer from your checking account to your savings account. It’s a great way to save automatically before you’re tempted to spend on nonessentials.
5. Pay off credit cards each month. College students are especially vulnerable to credit card debt. The newfound ability to open a credit card plus the hope of a lucrative job in the future can make charging to credit cards now – and planning to pay later – tempting. It’s best not to fall into this trap. Establish a habit of paying off your cards, and you’ll head off a lifetime of wasting money on interest payments.
6. Cut out wasteful food purchases. If you’ve purchased a meal plan with your college, use it. Don’t double up on costs by missing dinner hours or opting for fast food instead. If you don’t have a meal plan, note that buying food and beverages on the go is a huge expense. Make your coffee and lunch at home for a fraction of the cost.
7. Know your billing schedule. Pay attention not only to when monthly bills are due, but also to the timing of costs like tuition and textbook purchases. Also, don’t forget to plan ahead for seasonal expenses like spring break.
8. Create an emergency fund. Saving even $20 per month will help you build a buffer to deal with surprise expenses like computer repairs or medical bills.
9. Dump the car. See if you can get around by bike or public transportation. Chipping in on gas for shared rides on the weekends is still far cheaper than paying for car insurance, parking, and maintenance.
10. Ask for student discounts everywhere. Even if you don’t see any signs, ask about what’s available, and you’ll probably save a few bucks.
Now is the perfect time to take control of your finances. Learning to live on a budget today will serve you well in the future.
How do you stick to your budget? Share your tips in the comments.
Download our college budget worksheet to get started.