If you are a college student, by now, you may know the importance of managing your finances. If you are new to the college scene, you will quickly find out. The advice and principles here are not only for college students, but anyone who wants to learn how to better manage their finances.
The Wealthy and the Poor
Read through this article and write down the finance management tips that are most essential to your situation. However, make sure that you take action on what you have learned here or your situation will remain the same. Did you know that the difference between the wealthy and those living in poverty is their interpretation of money? The wealthy believe that you will have more money as you age and the poor believe the opposite. However, the wealthy have already realized the importance of beginning your financial management at a young age. Doing so will afford you more time and more money.
With that analogy, it is safe to say that most college students are financially poor. Why? Most of them are not interested in managing money and so their net worth may be currently zero. For many college students, they spend more money than they have. How is this possible, you may ask?
Let’s look at a scenario below. Jennifer is your average 18 year old college student who is studying at her local University. Jennifer loves to hang out with friends watching movies or going out to eat. Jennifer’s family is classified as a middle income family. Jennifer receives an allowance each month of $500 and she earns an extra $200 for providing tutoring lessons to other college students. At the end of the month, Jennifer finds that she has little money left over. At times, she has to call her parents to handle some of her expenses. The parents, of course, may oblige in most cases, which is only enabling Jennifer to do the very same thing next month. So parents should teach their teenagers how to manage their money instead of making it worse.
Having a Budget
College students should understand that they can still hang out with their friends, but not have to spend money on the expensive things that their friends are buying. You must have a budget and stick to it. Let friends know that you are on a spending crunch because you want to be able to see where your money is going. If friends do not understand, then may be, you don’t need to be hanging out with them in the first place.
Nothing is wrong with being frugal. For example, if you can cut coupons for added savings, why wouldn’t you? If you can buy a discounted and cheaper item instead of a name brand, then why not?
Here are some frugal tips:
· Drink water instead of soda. It can save you hundreds of dollars each year. Water is still quenching your thirst and providing good health.
· Put cash in different places of your wallet so that you don’t have cash readily in sight to spend.
· Don’t carry too much cash around. If you have to withdraw money from the ATM, get only what you need for that day.
· Track every dollar you spend. There are many apps that offer this feature. If you have no app, just write it down.
· Use a credit card or debit card to make purchases instead of cash so you can track your spending.
If you are financially responsible as a young adult, it will carry over to adulthood. So, the best time to embrace financial education and financial management is now.