Don't worry, this isn't a 20-page lecture about how not to spend money, it's just some quick tips to get you started.
If you want to learn more, there are links at the bottom of this page with lots of useful information.
2 Things to Remember
It's easy to feel rich and carefree when your student loan money arrives, but it's all too easy to spend.
There's nothing worse than eating nothing but ramen for 3 weeks at the end of the year because you've got no money left, so here are the 2 most important things to remember:
1. Don't spend money you don't have.
(This includes using credit cards, or money you should get later.)
2. Pay the important bills (rent, gas, power, etc.)
before using your money for optional spending like your cellphone or eating out.
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If you can do this, you're on the right track!
More Information
You probably want a
little more detail now, don't you? Here are some other suggestions:
- Don't assume you're going to graduate with loads of debt and therefore a few extra dollars here and there won't make any difference.
- Draw up a rough budget, allowing money for rent, utility bills, tuition, fees, food, social activities and some spare. Don't forget to include for car tax and insurance if you have a car, and gifts or travel. (There's a nice spreadsheet to help you available here, or paper forms if you prefer.)
- Once you have a budget, try to keep to it - if you run over one month, spend less the next.
- Try to save money each month, even if it's only $5 for Christmas presents. Compound interest works in your favor when saving early!
- Use credit cards only for true emergencies. Don't use them for consumables like food, drinks, or gas.
- If you do use a credit card, pay it off as quickly as possible. Compound interest works against you here, and credit card companies love people who don't pay the full amount each month.
- Use gift cards or your CampusCard to help you budget. You can top them up each month, and once you've spent your weekly/monthly allotment, you know you have to wait till next time. (This stops overspending at Starbucks or Jazzman's too!)
I Wish I'd Known This Before!
In the immortal words of Douglas Adams,
don't panic! Being in debt is not the end of the world, though it may feel like it. That being said...
| If you get into debt, don't ignore it. |
The bills won't go away, and the situation will get worse.
Follow these steps to help control the problem and to arrange repayments that won't cripple you:
- Find out exactly how much you owe and to whom. Get everything in writing, and make sure you know what interest rate is being charged.
- Speak to a debt counselor. This could be someone from your bank, an accountant, or from one of the many companies who specialize in this.
- Write to your bank and everyone to whom you owe money. Explain that you intend to repay the debt, but cannot do it all at once. Offer to repay at a set amount each month, no matter how small, and ask if they will freeze the interest. Your debt counselor may be able to help you with this.
- Don't go to loan consolidation companies, or anyone who charges you a fee to "fix" your debt or credit report.
Further Reading
Saving money the student wayMoney matters for studentsTop 5 money mistakes made by students27 money tips for studentsSmart credit tipsFinancial resources for studentsThe pitfalls of credit cardsCredit cards teaching students a costly lessonFinancial gameplan for students