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Five Money Management Tips for College Students

Five Tips on Money Management for College Students

College students are well-known for living very frugally, but sometimes they also need money for various types of entertainment or social activities. So it is good to learn something about effective management of your finances during college, which would help you get prepared for the life after graduation. There are many opportunities in which you could manage and save your money well. Here are some tips in this regard for your reference.

1. Avoid using credit cards.

There is a popular trend that credit card companies often encourage teenagers to use their cards when they get to the age of eighteen. So when you are old enough to be the card-holder, you should be cautious about accepting a credit card, with which you could spend more than the amount in your savings account. As you are unemployed and supported by your parents, if you choose to use a credit card, do remember using it carefully with your savings. If you could secure your credit cards in college days, you could build your good credit history for your future life.

2. Create a Budget.

If you want learning to manage your money well, you had better work out the monthly budget. It is quite is simple for creating budget. You could resort to the spreadsheet software, or more easily, you could do it with a pencil and paper to add up what you have earned and spent. You could make calculation by dividing the data between two columns. By doing so, you would be clear that in which area you have spent more than you should, and you may change your bad habits, which would be not helpful in saving money. For example, if you see that you have spent quite big amounts of money on petrol, therefore you could do more things on campus or choose public transport in order to save your spending on petrol.

3. Focus more on your needs.

In life, you have basic needs to be satisfied, such as car insurance or rent for your apartment, but you have also get something you want to do, like going to movies, purchasing fashion clothing. So how to balance your needs and wants is the big issue for you to consider in saving money. In this way, you could learn some techniques in comparing prices on your needs and spending on wants once you have saved some money every month. When you go shopping, you should do the comparison, which helps you save money in any possible way. In addition, you should try to avoiding spending on your wants instead of your needs so as to get prepared for the responsibilities you have to take after college.

4. Share expenses with roommate.

During your days in college, if you could share expenses with your roommate, it would help you cut down your monthly expenses. Whether you share a room with your roommate in an apartment or a dorm, his or her contributions to household expenses would largely reduce the living costs of you and your roommate. It is necessary that before you share a room together, you should check with your roommate on how you would divide the expenses between you.

5. Learn to pay taxes in college.

There is a popular saying that ignorance of law excuses no man. If you could learn something about taxes as early as in your college days, it would much helpful in avoiding your financial trouble when you enter into your life after graduation. Not many students know that you have to pay tax for the interest you have earned from a savings account. If you are examined by the auditor, your failure to pay your taxes could put you in the position for the penalties from the IRS. Therefore it is kindly suggested that you should learn to fill your tax return forms correctly in college, which would help you do it as well when you have the large sums of money to deal with.

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