PRAVEEN LAM: How to Save Money While in College

Sunday, 3 November 2013

How to Save Money While in College

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How to Save Money While in College

One of the hardest life lessons for many college students is that of sound money management. Personal finance is a challenge at any age, but for all kinds of reasons, it’s particularly tough during the college years, a time period filled with financial temptations in all their various forms. Being on your own for the first time and dealing with a busy schedule can lead to excess spending and minimal financial planning.

Every penny spent on late night pizzas or weekend road trips means less money in the savings account you’ll be counting on post-graduation. Life after college is tough enough without having an empty savings account staring you in the face.

The best way to ensure financial stability after graduation is to begin your college experience with the tools that will allow you to enjoy your time on campus without going deeply into debt at the same time.

Read on for some great college-specific money saving tips that can also apply to life after graduation:

• Develop a system of money management and financial planning that is well organized and works for you. Ideally, this will be set up before you step on campus so you have the foundation for wise spending and saving for the next four years. Ask around for tips on how to set this up, knowing that ultimately this system needs to fit your personality and organizational style.

• It’s never too early to start investing, even during your college years. Books, tuition and beer aside, there’s always some room to invest a bit of money in your long term future. Little amounts invested wisely now – even $25 per week or less – will compound significantly over the years and will reap huge rewards down the line.

• Break existing bad habits and avoid creating new ones. It’s shockingly easy to spend money stupidly during college, especially when it comes to vices, which seem to invade all corners of campus social life. The best way to avoid spending without thinking is to never forget why you’re in college and where you see yourself afterward. Go to class. Stay busy and avoid the boredom that often leads to foolish expenditures. Exercise, eat healthy and take advantage of the countless free activities available on college campuses.

• Resist the urge to spend the money you do earn during college. If you’re living in a dorm and eating in the dining hall, you have no good reason not to take your work study or waitressing paycheck and deposit it directly into the bank. Just because the money is there doesn’t mean you should spend it. When you get to school, open a savings account, deposit your earnings there, and don’t touch it.

• Buy used textbooks, live without a car on campus, and don’t be sucked into the vortex of materialism that preys on so many college students. Stay on top of the little expenses that often fly under radar, such as fancy coffee or a fast food lunch.

Even though tuition is steep, actual campus living doesn’t have to be. Still, it can be hard to determine what the best choices are during this crucial time of your life. By balancing your spending, saving and investing, you should be in solid shape to handle your finances once you’re out in the “real world.”

Erin Palmer is a contributor to U.S. News University Directory, a leading resource for business management degrees and other online business degrees from accredited colleges, as well as a growing collection of education articles and career videos.