The college years are almost synonymous with a tight budget and substantial financial concerns. Many college students fall heavily into debt, including credit card debt, because they have a lifestyle that they simply cannot afford. Others graduate with tens of thousands of dollars in student loans.
When you learn about some effective ways for college students to make the most of each dollar, though, you may be able to reduce your financial stress in this stage of life and avoid taking on debt unnecessarily.
Understand Your Budget
The first thing that every college student should do is to prepare a budget. Many young adults leave their parents’ home and venture off on their own without creating a budget, and this can be financially dangerous. Without a budget, you cannot know how much money you need to earn from a part-time job, how much money you need to borrow from student loans, how to cut back where you are spending too much, and more. Your budget will guide you in making smart financial decisions. Remember that you may need to revise your budget each semester.
There are a lot of decisions that you are making at this point, and you should make sure you think through all of them, so you don’t make a bad decision. When choosing a university, you need to consider what you want to study and the cost. If you don’t have a lot of money and you don’t want a lot of debt, then an expensive private university shouldn’t be on your list. Instead, consider cheaper alternatives, such as a public university or an online university. These are cheaper, and online universities are more flexible, allowing you to work more while taking classes. You should also make sure that you figure out what you want to study as quickly as possible. It may take a while, but every semester that you spend taking filler classes is another several thousands of dollars of debt that you'll eventually have to pay off.
Get a Roommate
When you go to college, one of your biggest expenses will be what you pay for housing. When you have a roommate, your expenses for rent, utilities and more can be cut in half. Getting a roommate is a financially savvy move to make that could potentially save you hundreds of dollars or more each month. If room is available, consider getting several roommates to further lighten the load of your housing expenses.
Focus on Transportation Expenses
Some college students also pay a fortune for transportation expenses. For example, you may have a high car payment, fuel costs, insurance expenses, maintenance costs, parking fees, and more. You may be able to reduce many of these expenses by simply choosing a vehicle that is more affordable to own and drive. You can also ride a bike or walk if you live close to or on campus. If possible, get rid of your car entirely. Remember that you can use ride-sharing apps as needed if you need to travel farther than usual one day.
Watch First Alliance employee Robin Fries discuss whether college is worth it on KIMT.
Use Student Loans Wisely
Student loans can be used to help you make ends meet as well. Loans are most commonly associated with paying educational expenses. However, you can live on some of the proceeds. Choose a profitable career path so that you can afford to repay your student loans and other related debt that you incur at this stage of your life. Remember that creating and analyzing a budget regularly will help you to determine if student loans are needed and what amount of loans are required.
Manage Your Money Throughout College With First Alliance Credit Union
One of the common challenges that college students face with regards to money is simply learning how to manage it. You only have a fixed amount of money to live on each month, so it is important that you allocate funds appropriately on a regular basis. You also should only take on debt if you have a reasonable strategy to repay the money in the future.
First Alliance Credit Union has several financial tools that will help college students as they navigate their way through the education system. Become a member today and take advantage of low interest rates, college savings accounts (529 Plans), and loan officers who legitimately have your interests at heart.