You can learn many valuable lessons at college. Money management is one of them. Most students find that out the hard way when they realize they’re spending more than they’re bringing in. For some, Mom and Dad are a reliable safety net but they’re not going to be there your whole life. So become one of the smart kids and learn how to manage your finances. It’s not as difficult as you might think, all it takes is some simple planning and budgeting. That does mean you’ll have to sacrifice here and there, but if you get a firm grip on your money situation earlier than later you won’t have to sacrifice as much in the long run. There’s nothing worse than needing the funds for some essentials expenditures like food or rent and not having it in your bank account. Proper management can help you avoid that buzzkill.
Start with a Budget
It’s not much fun to do but it’s absolutely necessary. Sit down and list all of your monthly expenses and obligations. These can range from everything to your cell phone bill to rent to student loan payments to entertainment expenses, and of course, food. Getting a clear picture of how much you need to spend each month will make allocating the funds to those items much easier than if you cover each one as it comes. Factor in your income each month and then you can start to organize your finances in a cohesive manner that will allow you to stay on top of what you owe and when. That way there aren’t any surprises down the road.
The age old debate of wanting something versus needing it can be a nebulous situation. Many college students have a tough time making the distinction between the two and as long as you know which is which then you’ll have an easier road to budgeting your money. We all know things like food, a roof over our head, power and heat, are all necessities and, obviously, you want to make sure you have enough money to pay for all of these things first. Once you’ve determined how much money you’ll need for your essentials, then you can set some aside for the fun stuff. Going out to movies and concerts, a little partying, maybe buying that video game system, these are all frivolous expenses that some might argue are also necessities after all of those hours of working hard and studying at New England College. These should come secondary but if you budget correctly, you should have a little left over to enjoy yourself.
Open a Checking Account
This is a must. You’re going to need to open an account to help you pay for things. You’ll probably get a debit/ATM card and that will allow you to pay for items at merchants and online retailers. If you have rent to pay, you’re going to need to write checks to cover it, a lot of landlords don’t want cash. A checking account is the best place to put your money so you have 24-hour access while keeping it safe. You’re certainly not going to stack it in your bedroom. This is the first step to financial responsibility, so take it.