Student budgeting to make your money last all semester
If you're in college, you know that student budgeting has specific challenges. Typically, you receive money in large chunks, either from loans, education savings plans, or summer job savings, and then you need to make it last for several months. If you're managing your money for the first time, it can be tempting to spend big early on, then struggle to pay the bills later. Budgeting for college students is essential to avoid that end-of-semester crunch.
Why make a college student budget
Mention the word budget, and most students groan. But having a financial plan will save you from realizing that it's January, you're out of money, and your next loan doesn't arrive until March!
How to create it:
- Start your college student budget in the fall, when you've saved your summer earnings and received your student loans.
- Identify all your sources of income - scholarships, money from parents, savings from jobs - and when you expect to receive the funds. That's your income.
- Now make a list of all fixed costs: tuition, phone, rent and utilities, and when they’ll come due. Here's a tip - if you bank online, ask your bank to send you payment reminders for when things are due.
- Next, estimate your regular discretionary expenses like food, laundry and entertainment, as well as infrequent expenses like trips home, books and course materials.
- Add a little extra for unexpected or emergency expenses, like a computer crash.
- Are your expenses higher than your income? Take another look at ways to save. Consider living with roommates, taking public transit or switching to a low-cost cell phone plan with plenty of texting.
How to stick to it:
- Write down your expenses for the first few weeks and compare it to your college student budget. Are you eating out more than you planned? Did you have to buy new textbooks instead of used? If so, adjust your budget.
- Stay current. On campus and around town, you can easily check your balance and pay bills with optional Bill Pay, Online Banking, Mobile Banking and Text Banking.
College Budget Tip #1
Love those discounts! Get into the habit of asking everywhere you shop, eat, or visit if they have a discount for students.
Income still less than your expenses? Don’t panic, we've got ideas.
Need extra cash?
If you do end up running out of money before the end of the school year, consider your options for cash - some are better than others.
- Part-time jobs are a great way to make money, and campus bookstores, pubs, cafes, and libraries are good places to look for employment.
- Consider asking your parents for help.
- Check if your college offers emergency or short-term loans. Contact the financial aid or student services office.
- Federal student loans are a good option because they are interest free while you are in school, give you a short break on interest after you graduate, and have a lower interest rate than private loans.
- Non-federal student loans from a financial services company or a bank often start accumulating interest right away. Payments may be required while you're still in school, and they also can have variable interest rates of 18% or higher. Avoid these if possible.
- Taking cash advances on your credit card is generally more expensive than making purchases with your credit card. That's because the interest rate is often higher, and there's usually no interest-free period. Try to say no.
Your college years will stay with you forever: the friends you make and the things you learn. It's also a great chance to start learning about money management. Learning to follow a college student budget can ensure you graduate with straight A's, great job prospects, and a healthy credit report. Click here for more tips on budgeting while in school. Good luck!
What's next? A student's guide to building good credit
You must first enroll in Online Banking, and set up Transfers and Bill Pay. Wireless carrier fees may apply.
Bank of America does not charge for Text Banking. However, your mobile service provider may charge for sending and receiving text messages on your mobile phone. Check with your service provider for details on specific fees and charges that may apply.
