If you are one of the millions of college freshmen headed off to school this year, you should try to learn more about budgeting and smart spending strategies before you hit the campus. Knowing how to manage money is vital to the college experience because if you wait until after college to take control of your finances, it could cost you. If you don’t rationalize your spending and you use your money to take trips, buy expensive electronics or even for day-to-day expenses that you can’t afford, you will soon realize that you are racking up unnecessary debt. Here are 7 finance tips for freshmen that will help you save and manage money better:
1. Create a Budget
One of the most important things you should do if you are heading off to college this year is to learn how to create a budget. Try to outline how much money you receive monthly and what you need to spend. Also, make sure that you are tracking your spending so you can stick to your budget.
2. Be Careful with Credit
Even though it’s easier to buy all kinds of things that you think you want or need using your credit cards, try to be wise and be careful with credit. Just keep in mind that a credit card doesn’t equal free money but if you decide to have one, look at the annual percentage rate, grace period, annual fee and penalty fees.
3. Take Advantage of Student Perks
Try not to spend extra money on food if you have a cafeteria. Just research college meal plans because these can be cheaper than outside food and even though they might not be offering the meal you want, it will help you save quite a lot of money in the long term.
4. Pay Less for Textbooks
When you are in college, textbooks can be pretty expensive and their cost can really affect your budget. If you want to save some money, try not to buy new books at the campus bookstore. Instead, consider renting textbooks at your school’s bookstore or even from websites like chegg.com. This can help you save up to 50% of their cost so it’s a pretty smart move.
5. Borrow as Little as Possible
If you want to apply for a student loan, try to borrow just enough to pay your legitimate college costs. When you decide to borrow money, make sure that you understand the cost and all the other terms of the loan before signing the contract. Just start looking into funding early and always submit applications before deadlines.
6. Search for Grants
One of the most important things you should do when you are a college student is to make sure that you always search online for grants, scholarships or other financial aid based on gender, race, ethnicity, religion, the type of degree you would like to obtain or any other relevant criteria.
7. Set Financial Limits
If you want to avoid getting in debt, try to avoid unnecessary fees and also try to set some financial limits when you decide to spend money on something. For example, if you want to spend more than $50 on a certain thing, try to think carefully if you really want it or if you really need it. Just ask yourself if you can do without that thing. For example, “Do I really need that video game now?” or “Is that restaurant too expensive?”
If you are a freshman and you want to avoid getting in debt and your goal is to learn how to manage your money wisely, then make sure you take care with credit cards, look for student discounts, get organized and stick to a budget. Do you know any other helpful finance tips for freshmen? Do tell!