The college years are a time for learning, growing, and exploring. But they're also a time when many students find themselves struggling to make ends meet. If you're like most college students, you probably have a limited budget and are constantly looking for ways to save money.
One of the best ways to save money in college is to carefully budget your finances. By creating a budget, you can make sure that you're spending your money wisely and not overspending on unnecessary things.
Not knowing how to create a financial plan, you will someday find yourself in a situation like hitting the ball fat in golf, which will lead to more money wasted and budget misallocation.
In this guide, we'll show you how to create a budget as a college student. We'll cover everything from setting financial goals to tracking your spending habits. We'll also provide some tips on how to stick to your budget and make the most of your money.
Have the money talk
Before you develop a budget, speak with the individuals who will be financially investing in your education — parents, guardians, or a spouse. Discussing your situation openly will guarantee that everyone is aware of expectations.
“Making money and expenses a taboo subject is one of the most significant hurdles we face when trying to teach financial literacy and financial skills to young people,” says Catie Hogan, founder of Hogan Financial Planning LLC. “The most essential tool for opening lines of communication is far and away open lines of communication; just so everyone's on the same page with what things will cost and how they can keep some money in their pocket.”
Anticipate your expenses
Keep these college-related expenditures on your radar to determine what you'll spend each term:
- Textbooks and school supplies may be costly. Course materials might consume a significant amount of your budget. The College Board estimated that the average cost of books and supplies for in-state students living on campus at public four-year institutions in 2016–2017 was $1,250. Also consider necessities like notebooks, a laptop, a printer, and a backpack for money-saving advice on buying these items.
- Room and board. When it comes to meals and living conditions, consider your choices. Consider the expense of living on campus versus renting an apartment and purchasing food.
- What kind of transportation do you want? Do you want to take the bus, bike, or walk to and from campus or work? If you must drive, plan ahead of time for gas, maintenance, and insurance expenses.
- Go shopping for clothes with your children. Budget for seasonal clothing and internship-friendly clothing.
- Discretionary expenses. You need a vacation from studying. Leave room in your budget for enjoyable things like entertainment, travel, and social gatherings.
Track your spending and cut back where you can
While your income may come from a variety of sources, the general concepts of budgeting, such as living below your means, remain true. Determine how much money comes in and out regardless of whether you generate money through side gigs, receive parental assistance, or receive financial aid — or any combination thereof. The free budget offered by NerdWallet is a good place to start.
You won't have to go through a laborious procedure such as filling out a spreadsheet every day; you'll have enough work. Just set aside some time at least once a month to audit your financial status. Budgeting applications and internet banking can aid in making the process simpler.
4 steps to creating a college budget
1. Discuss it out. Before producing a budget, speak to everyone who will be involved in your education's financing. Talk about who is paying, anticipated charges, financial assistance, and perhaps creating a new credit card or checking account.
2. Make a list of your expenses. Prepare for the cost of textbooks and supplies, room and board, transportation, clothing, and other miscellaneous spending.
Keep track of your money. Once you get to school, keep an eye on your spending. Determine what needs and wants there are so that you can decide which non-essentials to cut.
5. Take budgeting to the next level. Start planning for your future if you're in good financial condition. Create an emergency fund, for example, or a strategy for paying off student debt.