Are you a new college student? If so, there is no doubt that you have a ton of things on your plate. With everything from coordinating your classes, completing homework and trying to fit in a social life, one of the last things on your mind may be managing your finances. Whether your parents help support you financially, or you do it all on your own, there are some things to keep in mind to prevent a financial windfall. Here are a few ways that you can practice some good money management while in college.
Managing Your Books
College textbooks can be extremely pricey, even when borrowing them for a short time, but the books mentioned here have to do with finances, not college textbooks. Keeping track of your books or your finances means making sure that you don’t overspend or overdraw your checking account. This can be easy to do as a new college student. A few late night fast food runs or a weekend trip to the mall can easily cause you to overspend when it comes to your checking account. The next time you go to use it, your debit card gets declined. Knowing how to manage your account now will set the precedence for your future banking habits. Overdraft fees can easily rack up to several hundred dollars in a matter of days. Overdraft protection can help some, but abusing that cushion can cause you to lose your account at that bank. Same with going over your credit limit on your credit card. The fees can really pile up. Always take time to track your spending before you use your card. Stay connected with your bank balance with an easy-to-use phone app and by checking on your laptop frequently. Choosing a bank that offers accounts to help college students or first-time bank account holders like those at OakStar Bank. This can make it easier to manage your money and avoid substantial account overdraft and overage fees.
Paying Bills on Time
Being on your own for the first time can be scary and overwhelming when it comes to knowing how to pay your bills. While you could have your parents do it or an older sibling, now is the time to learn for yourself how and when to pay your bills. You’ll have to coordinate when to pay them based on when you get paid and how much you get paid. Paying them on time is important because it can negatively affect your credit score. Your credit or FICO score is based on a few things:
- How often you pay your bills on time
- Any derogatory or unpaid debt
- Amount of accounts or credit cards you currently have
- Balances on your credit cards vs. the credit limit
- Length of time you’ve had an account
- How many open accounts you currently have
All of these things are taken into consideration when it comes to determining your creditworthiness. Making sure that you don’t go over your credit limit and your monthly bills on time each month before their due date can help improve your credit score and make it easier to gain credit in the future.
Creating a Personal Budget
It’s vital for you as a college student to create a solid personal budget. This means making a list of all of your monthly expenses, bills, credit cards and enough to set aside for savings. If you don’t work and just get a stipend from your parents, this can be challenging and you may have to tweak your budget to allow for the finances that you receive. This allows you to manage your money easier, and have a visual reminder as to how much money you have to spend and where you should spend it. Start off with a daily planner or you can even keep track of funds and bills on a notebook.
Asking for Help
If you are struggling with your finances, overdraft fees and not having any money before the end of the week or month, don’t fret. Now is the time to ask for help. Start with your parents or other caregivers who are there for you and help support you. If you don’t have that, talk to your school’s financial officer, especially if you are having trouble paying for college. They can offer assistance by suggesting grants or scholarships that you may eligible for. They may also guide you to a social service agency to help provide some insight on programs you may qualify for based on your income.
Taking control of your finances as a college student doesn’t have to be out of reach. Take small steps to ensure that your future is off to a great start.