Learning to manage money and create a budget can be difficult for college students. And as we prepare to see kids and college students head back to class, now is a good time to discuss some budgeting tips to help college students make the most of their income.
Here are 8 budgeting tips that can help college students create better financial freedom during these budget-tight years.
1. Be Realistic About Your Budget
If you have never created a budget before then you need to know that the most important thing you can do is be realistic about the money that you have coming in, going out, and where you can cut corners. Be honest and realistic. If you overspend on clothing or your groceries, this is something you’ll need to pay specific attention to.
2. Be Clear About Wants vs. Needs
There are, of course, things that you want. But, do you really need them? Can you forgo a night or two out to save that money? Ask yourself while creating your budget if you really need what you’re allocating money to. Handle your needs first, then your wants.
3. Guess Low & High
For your income, you should estimate lower than you expect or hope. And for your expenses, you should guess high. Being off in both these areas allow for some cushion to re-evaluate and decide where your budget really lands.
4. Savings Is An Expense
Creating a savings in your budget is part of your expenses, and it is a need. You should prepare for the unexpected. Be sure to build your savings account so that when something comes up, you’re prepared to handle it in part or whole.
5. Keep Your Bills & Recipes
Grab an accordion file and begin to save all of your bills and recipes in one organized place. This will make it significantly easier to track your spending, help you to dispute a bill if necessary, and will ensure that you’re ready for taxes at the end of the year.
6. Pay Cash For Small Expenses
Give yourself a daily, weekly, or monthly allotment of cash, and use it whenever you can. Every time you pay cash, you’ll be more conscious of what you’re spending than if you paid by credit card, check, or online withdrawal.
7. Invest Your Change
Let’s face it, change adds up. We’re more likely to hand a $5 over when spending $4.35. That remaining $.65 is now just sitting around. For loose change, save it and then regularly deposit it directly into your savings account. When paying with a debit card, consider using a money saving app that will round up for you and add that extra $.65 automatically to your savings account.
8. Review & Recalculate Your Budget
Budgets are not set in stone. While you should absolutely follow what you have laid out, they should be adjusted and modified as expenses and income changes. So be sure to readjust accordingly as time goes on to make sure that your budget is still in line with your goals and spending habits.