Budgeting Money for College Students

College students may not have had to think about budgeting before entering college, but most students have a set amount of money to work with for college and budgeting is a must. The amount of money a student receives from college loans, financial aid, their own savings and family help may seem like a large amount of money until they start to evaluate their expenses.

Often this is their first experience with a credit card, and it is important for them to use the card wisely. The way students handle credit cards is the number one mistake made by college students. Many cards have high interest rates and they allow students to spend more than they can possibly afford. Some students start spending too much money on entertainment, clothes and gas. Before they know it, they can’t make the payment on their credit card. The outcome of this problem can hurt the student’s credit rating over the long term. It’s easy to make a mistake, but realize that those mistakes can prove costly even later in life.

The basics of budgeting are the same for students as they are for anybody else. Lack of budgeting is the third most common mistake students made in college. Budgets are necessary for a student to know how to manage their money.

First, list all their income and money they have to work with for each semester. Then list your expenses, such as tuition, books, groceries, gas, entertainment, etc., in as much detail as possible. The worksheet below should be very helpful to look at the big picture when it is in black and white right before you. As long as the expenses are less than the income they are in good shape if they stick to the budget.

If an expense is incurred more or less often than monthly, convert it to a monthly amount when calculating the monthly budget amount. For instance, auto expense that is billed every six months would be converted to monthly by dividing the six month premium by six.

College students may not have had to think about budgeting before entering college, but most students have a set amount of money to work with in college and budgeting is a must. The amount of money a student receives from college loans, financial aid, their own savings and family help may seem like a large amount of money until they start to evaluate their expenses

Often this is their first experience with a credit card, and it is important for them to use the card wisely. The way students handle credit cards is the number one mistake made by college students. Many cards have high interest rates and they allow students to spend more than they can possibly afford. Some students start spending too much money on entertainment, clothes and gas. Before they know it, they can’t make the payment on their credit card. The outcome of this problem can hurt the student’s credit rating over the long term. It’s easy to make a mistake, but realize that those mistakes can prove costly even later in life.

The basics of budgeting are the same for students as they are for anybody else. Lack of budgeting is the third most common mistake students made in college. Budgets are necessary for a student to learn money management.

First, list all their income and money they have to work with for each semester. Then list your expenses, such as tuition, books, groceries, gas, entertainment, etc., in as much detail as possible. The worksheet below should be very helpful to look at the big picture when it is in black and white right before you.

As long as the expenses are less than the income they are in good shape if they stick to the budget. Some college students work part time while attending college to meet all their expenses when their expenses are greater than their income..

To sum it up, these are the steps to take to manage your money well.

1. Prepare a budget worksheet.
2. Start tracking your incidental expenses. You know where the bulk of your money is going, but what about all those little extras?
   
3. Learn all you can about budgeting, spending, and saving your money.
   Take advantage of student discounts, and free offers. Here are some helpful student web sites online to help you save:
   Student Market
   EDU.com
   Stubex.com
4. Tips for college students to Live a frugal lifestyle:

• Shop Smart and Spend Less.
• Define wants from needs.
• Buy used text books which can often be found cheaper online than in the college bookstore.
• Don’t smoke, drink or do drugs. They are expensive and won’t help your academic performance.
• Recycle and reuse study materials such as pens, pencils, papers and notebooks.
• Make plans around the money you can afford.
• Don’t’ be tempted by how much your friend is spending.
• Make the most of the college’s meal plan and any college event where there is free food.
• Get a part time job.

This is a great time for students to learn money management skills that will follow them throughout their life. They will have a good credit rating. If they can be self-disciplined, they will have enough money to meet their needs throughout their college years.

The copyright to this article is owned by Pamela Oglesby. Permission to republish this article in print or online must be granted by the author in writing.