Being able to thrive financially as a college student is very important. Even though you’re focused on your academics, you need to sometimes pay attention to your finances. This is why it’s crucial for you to learn how to budget your income effectively.
Sometimes, as a college student, you may have to work on the side to fend for yourself and meet certain needs at school. If your earnings are not properly budgeted, you won’t be able to protect and grow your finances.
In this post, you will learn some of the best budgeting tips for college students. Even if you have tried budgeting in the past and couldn’t keep up with it, the tactics revealed in this post will help you get back on track with your budgeting.
Why Is Budgeting So Important For Students?
Budgeting for college students is key because every student needs to be able to make the right decision when it comes to purchasing things. If there’s a working budget in place, common financial mistakes such as impulse buying would be prevented and fought against.
Moreover, as a student, your cash flow is minimal because you can’t engage in a full-time job or business. To effectively manage your “small” income, you need to build a budget.
What Should A College Student Budget Include?
A student budget is different from a typical family budget. However, students’ budgets should cover basic needs such as rent, feeding, utility, and health. Depending on the student’s income level, the budget can also cover savings like an emergency fund.
How Difficult Is It For Students To Budget?
Some students find it difficult to budget because they haven’t experienced the real world. Most students are probably still getting support from family members and even the government; hence, they may not see a good reason to take responsibility for their finances by learning how to budget in college.
On the other hand, however, budgeting may prove difficult for some students when their cash inflow is very low. If there is not enough money in the bank, budgeting might seem unnecessary.
Importance Of Budgeting For Students
As a college student, you must take responsibility for your financial safety. Your parents or family members may support you with money, but they won’t be the ones to spend and manage that money.
Budgeting in college is one of the best financial decisions you can ever make. By the time you graduate, get a lucrative job, and start living the conventional lifestyle, budgeting won’t be hard work for you anymore because you have been used to it.
If you have never tried budgeting before, it’s important you learn the basic step of setting a budget and the different types of budgeting methods. Here is a guide that will show you how to build a budget in 5 simple steps.
9 Budgeting Tips For College Students
To help you make the right decisions when it comes to budgeting for students, here are simple strategies you need to learn:
1. Use A Budgeting App
There’s no denying that the internet and technology have made a lot of things easier for us, including budgeting. Since you’re a student, you have countless things on your mind; assignments to complete, topics to read, and any academic stuff that would put you on top of your game.
This means that you may not be able to devote enough time to budget your money. Therefore, using a budgeting app is the best thing to resort to. A budgeting app gives you the structure and focus you need to have a clean budget.
Thankfully, there are numerous budgeting apps you can use for free. Simply go online and search for them. Check the pros and cons of each app to choose the one that suits your budgeting style.
When you consistently use a good budgeting app for a couple of months, you won’t see budgeting as a daunting task anymore. Before exploring other budgeting tips for students, try to use a budgeting app, even if it’s once.
2. Save Or Invest Your Extra Cash
This is one of the budgeting tips for college students you were probably not expecting to see.
Saving money is very important even while you’re still in college. Your savings might be the financial saving grace you need at some point in your college journey. You can save your spare cash or invest it. These days, you don’t need to have thousands of dollars before you can invest.
Apps like Acorns can help you save and invest your money digitally. By saving your money on the app for a particular time, you will get a return on investment based on the amount you save.
In other words, you are simply growing your income. So if after building your budget, you have to realize any extra money, instead of spending it on something insignificant, save and invest it. It may not seem like the best decision now, but you will be grateful for it eventually.
3. Increase Your Credit Card Payments
If you have credit card debt that needs to be paid off, one of the best money moves you can make is paying off the debt as quickly as possible, as long as you aren’t breaching any agreement between you and your creditor.
You can do this by including double payments in your budget, and if the budget is not too tight, you can even include triple payments.
This won’t be an easy feat, and it would be tough for you to make all these double and triple payments. Nevertheless, it’s a decision you’d be thankful for by the time you complete the payments. Moreover, if you have student loan debt waiting for you, you shouldn’t add credit card debt as well.
4. Start Paying Off Your Student Loan
If you happen to attend college with all the financial backing you need without taking any loan, that’s absolutely fine.
However, if your college education is financed by a student loan, you should start developing feasible strategies to pay off your debt even before your graduation. The earlier, the better. As you learn how to budget in college, you shouldn’t forget about your student loans.
It would help to incorporate student loan debt payments into your current budget. It doesn’t have to be a lot of money. You need to be progressing with the bit-by-bit payments you can honestly afford.
If you have no idea how to get started with paying off your student loan, here is a guide that will show you 9 really fast ways to pay off your student loan debt.
By the time you graduate from school, you won’t have finished paying off the debt, and however, you would be much better than those who didn’t start paying while in school. You can consider advice as one of the budgeting tips for college students to help you stay on track with your budgeting.
5. Avoid Impulse Buying
Avoiding impulse buying, by all means, has to be one of the most important college budgeting tips you shouldn’t forget.
Even for people outside college, impulse buying has become a common money mistake that eats up people’s income and bursts their budgets. You must understand that one of the main purposes of building a budget is to fight against impulse purchases.
The moment you can’t control your spending habit despite having a budget, you defy that purpose, which won’t be favorable.
When it comes to budgeting, self-discipline is key. You need to be able to control your urges and suppress every negative habit that jeopardizes your budget. If you keep buying things recklessly, then you shouldn’t have bothered learning how to budget money in college in the first place.
6. Use A Cash-Back Credit Card
This tip is not for everyone; it’s for those who know how to spend cautiously. Before signing up for any credit card, make sure you can responsibly manage debt. Usually, most financial experts advise against using credit cards. But even if you have to use one, ensure you apply for the credit card that offers cash-back incentives.
This enables you to earn extra money on every purchase you make. However, that doesn’t mean you should use a credit card all the time. Remember, the cash-back incentive is still a trick by the financial institution to compel you to use the credit card frequently. Hence, you need to be wise as well.
This budgeting tip for college students can also be considered by those who aren’t schooling.
7. Shop At The Dollar Store
Many people don’t consider the dollar store a cool place to shop, but that doesn’t change the fact that it’s often the cheapest place to buy items. Purchasing things at the dollar store helps you save money if you buy them on campus or at a grocery store.
When shopping for disposable things such as trash bags, toilet papers, or sandwich bags, visit your local dollar store, where you can buy these items at an inexpensive rate. Keep this in mind when budgeting in college.
8. Live Below Your Means
Learning how to live below your means is essential when figuring out how to budget money in college. The main idea behind having a budget is to help you live within your financial capacity.
If you try to live above your means, you will burst your budget and struggle financially. Although living a frugal lifestyle won’t be fun in college, it will help you achieve financial freedom while exploring various budgeting tips for college students.
To live below your means, CPA and Columnist for Inc., Paul Sundin, advises that at least 10% of your monthly income should be saved.
On the other hand, the 50-30-20 rule can also help you live below your means. According to this rule, you are meant to spend 50% of your income on your needs, 30% on wants, while the remaining 20% goes for savings and debt. This is actually an effective budgeting strategy that a lot of people use. However, it’s not suitable for everyone.
9. Cook Your Meals
This is one of the budgeting tips for college students that should be taken seriously. Cooking is way cheaper than eating out. Although many people disagree with this, you can save money by not eating out.
Compared to what you can get outside, the meals you prepare at home can be healthier and more nutritious. Plus, you are not breaking your budget while cooking your meals and eating at home. If you have a busy schedule, you must learn how to prepare different types of meals and refrigerate them.
If you are someone who doesn’t know how to cook, you must understand that cooking is not rocket science, and it’s easy. You need to pay attention to detailed tutorial videos on platforms such as YouTube.
10. Get A Job (Bonus Tip)
While learning how to budget in college, you should have a reliable source of income. There are hundreds of thousands of students across the United States that work part-time jobs while schooling.
By earning money as a part-time employee, you would be able to cover your basic expenses and might not have to use a credit card or borrow money.
Getting a job is also very important if you have student loan debt to pay. Before your graduation, you can start paying off the debt bit by bit from your earnings.
Final Thoughts: Budgeting Tips For College Students
Now that you have explored some of the best budgeting tips for college students, you must ensure that you make the right decisions when building and maintaining a budget. Moreover, don’t seek perfection when you start with your budgeting goals.
There are times you might default and fail to meet certain financial obligations, but that shouldn’t discourage you. The most important thing is progress.
As long as you are better than you were yesterday with your budgeting strategy, just keep going and keep implementing these budgeting tips for college students.
Pin this for later!
