Financial Tips for Students
By: Zane Mondschein ’22, business administration, wellness assistant
Have you heard the expression “broke college student?”
Chances are, you or a friend have said this phrase before. It’s no secret that college students aren’t typically the most financially sound. Between tuition, books, rent, food, car, gas, parking and extracurriculars, expenses stack up quickly. Even with help from scholarships, loans and jobs, your finances can still feel out of order.
Financial well-being is directly linked to all the other elements of wellness including physical, emotional, social, community, and purpose. If you are worried about your current financial situation, or you’re unable to meet your basic needs, you may feel stressed out, depressed and experience anxiety. You may not want to take the time to work out, hang out with friends, work toward your goals or even eat balanced nutritional meals. Financial stress creates a fog over your life that can significantly impact all aspects of it.
So what can you do to reduce some of this stress and improve your current financial well-being?
Here are some tips:
You’ve likely heard of budgeting. It is extremely important to create and maintain a budget so you can see exactly where your money is going.
New to budgeting? Try creating a spreadsheet that shows all your income and purchases. You can use a simple spreadsheet app such as Google Sheets or a budgeting app such as Mint or Every Dollar. On one column, list all of your income. This can be from your job, allowances, grants, scholarships or loans. In another column, list all your expected expenses for categories such as rent, utilities, groceries, car payment, eating out and entertainment.
You can get a good idea for your expected expenses by looking at your bank account for the past couple of months. You can use your final column to record all your actual expenses as they occur. This will allow you to visually see how much you are spending in each category and how it compares with your ideal “goal” amount. Not only will this method help keep you accountable to staying on track with your goals, but it will allow you to calculate how much money you have left over after expenses. Students can create monthly or even weekly budgets.
Build a Small Emergency Fund
Although not every student has the luxury of having excess money, everyone should still aim to start building a small emergency fund. The purpose of this fund is to protect you if an emergency happens. Using your newly formed budgeting skills, you can easily see how much money you have left over after all your expenses. You can take a small portion of that money and put it away into a safety account.
Even putting $10 per paycheck toward savings amounts to $240 per year, or taking $50 per month is $600 per year. Every little bit counts. Having extra money put away on the side can improve financial well-being as well as overall well-being. Knowing that if you run into a problem such as a flat tire or a medical issue, you’ll have money to take care of those expenses which will bring a lot of comfort and security. Although many emergencies in college will be minor, it is great to start building the habit.
College is a once in a lifetime experience, so make sure to enjoy it. If you have extra spending money, don’t be hesitant to hang out with your friends, get involved in clubs, go grab some food or try new things. Being overly worried about saving your money and limiting spending can sometimes cause worse financial stress.
Everyone is in a different situation and lives a different lifestyle. Don’t compare yourself to others. Do your best with what you have, and remember, that your financial well-being is the foundation for a balanced, happy life.