The most important time of your life – the start of your career in academia, the moment lifelong friendships are formed, romantic relationships begin to take off, and it’s only a few months away.
But wait for a second! How are you going to pay for all of these great experiences?
Some college greenhorns are set up well with family trust funds, generous donations from parents or grandparents, or a personal nest-egg large enough to pay for just about anything they desire.
But what about you? If you don’t fit into one of these categories, you’re going to have to face the truth: you’re going to need a good amount of money.
Most freshmen live on campus, take part in at least a partial meal plan, and share a room with one, two, or even three other people!
With this in mind, carefully assess what you need to get through your first year. Do you need to dine out for every meal because you hear the University’s food sucks? Plan for it.
Do you wear expensive shoes fast or like to keep up with the latest designer purses? Then budget for it.
While I personally believe college is a perfect time to exercise frugality, not everyone needs to live by these ideals.
Some spend endless amounts of money in college because they know they won’t be able to when they are later saving for a house. Some begin their smart money decisions much earlier.
I find it best to start with an obtainable dollar figure – let’s say, $2,000. That doesn’t sound like a lot of money, but it is a reasonable amount of money to expect to make over the summer before college. Let’s say you make $8 an hour. It will take you 3 months at 20 hours per week to make about $2000 before taxes.
Not a bad time commitment considering this can fully fund your lifestyle for the next 9 months, giving you the following summer to repeat the process. Many students do this and live comfortable lives as:
$2000 divided by 9 months = $222/month.
A smart person, with no financial commitments (car payment, personal loans, etc), will take a long, hard look at what this money can do for them.
Although it is not much, saving just 25% of this $222 and not allowing yourself to touch it means an additional $500 in your bank by summer, ready to either roll over into your sophomore year or to be combined with the following year’s savings for a couple month’s rent in a shared, off-campus apartment.
Trust me, an extra thousand or so in the bank is a great buffer when trying to make it on your own as expenses seem to come out of the woodwork. If you can save more, do it!
While $200 or so a month doesn’t sound like much to live on, it can be carefully appropriated so that you can have fun and not have to decide between filling up your car or going grocery shopping. To help make this tangible, please take a look at how I structured my budget:
$2,000 to spend – $222/mo
Savings – $72
Groceries – $75
Gas – $50
Dining out- $25
Entertainment/misc – $50
Total : $222
A good rule of thumb is to save exactly (or close to) what you spend on groceries, or whatever your second highest cost is.
Not only will this get you to give the expensive ice cream or almond butter a second thought, as it will essentially cost you double the sticker price, but it will also help you establish a great way to save throughout your life.
Notice that savings are also placed at the top of the list.
This is because you are living off of a monthly stipend that you control. You must pay yourself before you pay the grocers, the oil companies, the restaurants you enjoy, and whatever else eats up your money.
It helps to visit the bank once a month, get 5 envelopes, and place the appropriate amount of money in each one.
Just make sure you put it in a safe place – dorm parties can get rowdy and often bring a mixed bag of people (trust me).
So, establish a simple budget and find out what you need each month to survive comfortably.
Be mindful of where your money goes, budget accordingly, and enjoy financial stability in a time when nothing else seems to be!