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Budgeting Lesson 2 - Budgeting for College Students

Anonymous
Posted on: 16th Aug, 2006 02:11 am
My experiences on budgeting have taught me the value of money and some good ways to manage it. I have thought of giving my views on this topic, which I believe will help others. This time I have included budgeting tips especially for college going students.

Nowadays college students earn for their daily expenses through part time jobs or even full time jobs in summer. And therefore, it's necessary for them to understand the importance of the money they earn.
Other Budgeting Lessons

Below are some of the tips which will help them and others to manage their funds well.

1. Track your expenses. Before you start a budget, it is very important that you know where your money goes. So you should track your spending for the first 3-4 weeks and avoid unnecessary expenses.

2. Plan your budget. That's the best way to manage your money. First of all, list all the sources of income like money from your parents, scholarship etc. Also list the expenses on books, tuition fee etc. And if you want to buy a new CD or you need some kind of entertainment, then make such provisions in your budget.

3. Spend at a steady pace. If you spend most of your money at the beginning of a semester, then you could be in some crisis later. So it's important to maintain a steady pace with your spending. Try to make a spending limit for a week and follow it.

4. Handling credit cards.Nowadays, credit cards are one of the quickest ways to spend more than your means. You may have a credit line of $1500 on your card but if you can only pay back $600, then its better that you spend only that much.

5. Look into the future. If you are planning to go on an outing with your friends or your due date on your car insurance is coming nearer, then start putting some money aside to pay for it.

I suggest that all college going students should discuss their money problems with parents or friends who have some knowledge of money management.

Managing credit cards is one of the major concerns for college students these days. This is because most of them spend beyond their means and then fail to get out of credit card debts. All they need is careful spending of what they earn or what they can avail through credit cards. A few tips to make things easier for such students.
  • Monitor your bills:
    Check out with your credit card bills every month and adjust your budget likewise. To avoid overspending, limit your debt to only 10% of your monthly income. There can be unexpected expenses for which you should always keep aside a certain amount.

  • Check out with the credit limit:
    Avoid using up the maximum limit on your credit card. It's not necessary that you can pay off as much as you withdraw using the card. This is because college life makes you spend more in all kinds of entertainment and miscellaneous activities. So, it's always better to set aside a certain sum of money for medical expenses or emergencies.

  • Pay your bills in time:
    Notice the payment due date as soon as you receive a bill from the credit card company. At least try to pay the minimum amount within the due date if not the outstanding balance. Otherwise, it is taken as late payment which affects your creditworthiness.
I hope these suggestions will help students manage their credit cards efficiently.

Jessica
Posted on: 16th Aug, 2006 03:32 am
Hi,

I feel it's better not to take credit cards to college until and unless students can avoid using it for anything and everything. It's a good thing not to use these cards for trivial things. Otherwise, if students can't pay down the bill in time, they may end up paying a higher interest in return.

For students, debit card is a good choice. This card allows them to get quick money and also limits their spending to the funds available in their account.

Thanks,

Emily
Posted on: 16th Aug, 2006 04:39 am
Hi, Jerry

You have touched the core part of financial problem and I totally agree with you that a thing has to start from the early days.

Yesterday I found related news which might help our readers. It might not be that much related to budgeting but it will surely help college students as well as their parents.

The news was on “How to Pay For College”

For a student the most important thing which matters is how to get into a good college. And most importantly how to bear the cost of high education. These things will always be there if you haven't saved enough for college.

Some of the points to look for:

• Know the Lingo
• Don't Be Scared by the Price Tag — Apply
• There's Money Out There — Go Find It!
• You Can Do It Cheaper
• Make the Grade, and Don't Give Up

Full coverage of the article can be found here.

Thanks
Posted on: 17th Aug, 2006 02:21 am
Hi,

You have entered into a new phase of your life and start going college. You may wish to establish budget so that it's help you to manage your finance. You can handle budget just like attending classes regularly.

First, you need to calculate your income:
At first, you need to prepare the list of income sources (like part-time job, monthly allowance given by your parents etc.) along with income amount. Now, calculate your total income in a month.

Then, try to figure out where your money will go?
Now, you need to figure out the amount money is going out. You can use a notepad to keep track of your expense for about a month.

Finally, Establish the Budget:
After keeping the record of expenses for the first month, you can start preparing a budget. Start by making a list of expenses head along with respective budget amount on the basis of last month, such as:
  • Hostel Rent
  • College Fees
  • Tuition Fees
  • Books
  • Food
  • Traveling Expenses

Thanks
Posted on: 17th Aug, 2006 04:28 am
Hi all

I am a college going student, and I have a disbalanced budget. How should I avoid piling of debts and other obligations....

Thanks in advance.
Posted on: 15th Sep, 2006 12:23 am
It’s good to know that you are worried about your budget.

Here are some ways that will help you to avoid debts.

  • Try not to carry a credit card to your college. Credit cards can very tempting to use it. There are lots of hidden costs in credit cards. The interest rate charged is also very high.

  • You can opt for debit cards instead of credit cards. This gives you an instant access to your money. They will also limit your spending to the amount that is available in your account.

  • Use coupons that are available to you. Since you are still a student, you will get lot of student discounts.

Thanks,
Jerry
Posted on: 15th Sep, 2006 12:38 am
I need to know why is it good to for the parents and students to come up with a budget and what would be an effective way to keep the student on there budget.
Posted on: 08th Aug, 2010 04:47 pm
Budgeting will help you in keeping a track as to how much amount you're saving and how much you're are spending. If your spending is more than your savings, then you can take immediate steps to increase your savings.

As far as students are concerned, parents shouldn't give them too much of money to spend. If they have a stipulated amount in their hand, they will not spend it on unnecessary items.
Posted on: 09th Aug, 2010 03:02 am
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