8 Budgeting Tips for College Students: Planning for a New Year (and Life) of Success
By Caitlyn Bittner, Marketing Intern
With the start of the New Year and classes coming back in session, there is no better time for a fresh beginning with your finances. As a college senior (Go Pack!), I know that expenses – from tuition and textbooks, to housing and daily essentials – can quickly escalate.
If you’re a student, you’ve probably felt the financial pinch too. But by being mindful with your money, you can protect your financial future and avoid unanticipated debt. Here are 8 smart budgeting tips that can help you build a strong financial foundation before you graduate:
Create a budget and spend below your means – The first way to budget smart is to … well, create a budget. Whether you opt to use a spreadsheet or an app, having a budget (or at least a good sense of how much money you’re comfortable spending each week/month) is an important first step to being in control of your finances.
The key to an effective budget is to understand your sources of income and your typical expenses. With this information, you can plan to spend below your means so that you can build up a buffer of savings to help protect from unplanned costs that will arise. Life’s twists and turns can easily lead to unexpected car repairs, medical bills, or impromptu getaways with friends, so it's important to account for these potential variances.
For more specifics on how to create a budget and build up an emergency fund, check out our blog posts “5 Steps to Become the Boss of Your Budget” and “Building Your Emergency Fund”.
Create an income source – If your course workload permits, explore part-time employment, on-campus roles, or better yet an internship. This will look great on your resume and allow for a more flexible budget. Additionally, this could even give you the chance to start paying down debt BEFORE you graduate. Between the income and experience, this is a way to invest in yourself that can pay dividends now and in the future.
Review FAFSA eligibility – Apply for the Free Application for Federal Student Aid (FAFSA) each year to see what financial aid you can be eligible for. Also, keep in mind that the earlier you complete the FAFSA, the better the chance of receiving a higher award!
Live with friends OR live at home – Living with friends can not only enrich your overall living experience, but also lighten your financial burden by allowing you to pool resources. Partnering up to buy groceries, furniture, and essential supplies can lead to substantial savings. Most importantly, communal living dramatically reduces your rent payment, potentially saving you hundreds of dollars per month.
Although potentially less exciting than living with friends or on campus, living at home can be a huge way to save money. If your proximity to campus allows for this option, it’s well worth the consideration. On top of the obvious savings on rent, you may not have to pay for groceries either. With rental costs soaring in recent years, many people have been struggling to keep pace with the inflated prices. At public 4-year colleges, students pay an average of $11,520 per year* just for room and board. Given these numbers, the advantages of embracing the familiar comforts of home can be even more appealing.
Find free entertainment and food on campus – Free food is one of the many perks of being a college student. Take advantage of this at campus events, networking fairs, and club meetings. There are also usually free movie nights, concerts, sporting events, and fitness classes you can attend to fill your social calendar. There are abundant ways to spend time with friends while on a budget!
Get cooking – While eating out or buying a meal plan may seem tempting, buying your own groceries can dramatically cut food costs. Bonus, homemade meals can help you cultivate healthier diet habits. While shopping, consider generic products, as they can be a lot cheaper and just as good. And remember, it’s the little things that start to add up. Think about those seemingly harmless Starbucks runs – one latte at a time, they will chip away at your budget! For more tips on minimizing your food expenses, check out our blog post “How to Save Money on Food (A Quick Guide That Doesn’t Involve Ramen Noodles)”.
Avoid paying full price for textbooks – It is no secret that textbooks can be expensive. Save money by getting them directly from other students, renting them, or opting for e-books instead of hard copies. Another tip: don’t rush into purchasing textbooks before classes even start. While it is good to be prepared, you may be told you don’t every book on the class list. Waiting a bit can keep your wallet snug and your backpack light!
Look for student discounts – From popular platforms like Spotify, Hulu, and Amazon Prime to trendy brands like Ray-Ban and Levi’s, many companies offer exclusive deals just for college students. Websites such as UNiDAYS can streamline the process of finding these discounts; you can find savings on clothing, media subscriptions, everyday essentials, electronics, and even airfare.
You don’t have to use every I’ve listed, but financial freedom can be very rewarding! Just a few small tweaks to your day-to-day spending can help you build smart habits that lead to long-term financial success.
*Source- https://educationdata.org/average-cost-of-college
This material is provided as a courtesy and for educational purposes only. Please consult your investment professional, legal or tax advisor for specific information pertaining to your situation.
This site may contain links to articles or other information that may be contained on a third-party website. Hilltop Wealth Advisors is not responsible for and does not control, adopt, or endorse any content contained on any third-party website.