5 Ways to Manage Your Money at College | Reader's Digest

5 Ways to Manage Your Money at College

If you or your child is heading off to school this fall, this crash course in personal finance is required reading.

By Reader's Digest Editors

1. Create a budget (and stick to it).
The first step is to figure out how much money you have to spend each month, between your family contribution, savings, earnings from a part-time job, and loans or grants. Then figure out how much you’ll need for staples like food, rent or dorm fees, books, etc. Then add in a line for spending money and another for emergencies (like when your coffee budget runs out right before exams). Keep track of your expenses and the frequency of your visits to the ATM so you don’t overspend.

2. Don’t break the bank for books.

There was a time when the university bookstore was the only place you could buy the textbooks required for your classes each semester. Those days are over. Online booksellers like Amazon.com offer significantly cheaper prices for most textbooks, and if you buy them used they’ll cost even less. Used books can often be found at your campus bookstore as well, and some bookstores even offer a rental option (if not, try an online rental site like Chegg.com). Don’t forget to sell back the books you don’t need at the end of the semester.

3. Watch out for fees, fines and penalties.
Paying $1.50 every time you take out money from an ATM might not seem like a big deal, but if you use the ATM three times a week, those fees can add up to $18 a month or more. The same goes for overdue fees on DVD rentals and library fines, not to mention parking tickets, or penalties if you add or drop a class after the deadline. Remembering not to overlook what may seem like the “little things” can save you a lot of cash in the long run.

4. Keep track of your finances online.
Setting up automatic payments or digital reminders when bills and tuition are due, payments have been made, or your balance is low not only helps you avoid late fees and penalties, it will also protect you from fraud. Whether you set up a new bank account in your college town or opt to keep your current one, explore the online banking options and choose email alerts that will keep you posted on your money’s comings and goings.

5. Beware of bad credit.
If you’re applying for a credit card of your own for the first time, be sure to choose one with a low APR and no annual fee. It’s also a good idea to keep your credit limit low ($1000 is a good place to start) so you don’t overspend and wind up in debt. Paying off your balance in full each month is the key to establishing good credit and keeping it that way.

See also:
10 Reasons to Skip the Expensive Colleges
5 Common Mistakes People Make with Their Money
Affordable Colleges for your Child to Consider

Source: Dailyfinance.com

  • Your Comments

    • http://www.strategiesgroup.com/ Jamie Shellman

      It’s a good exercise that will serve you well in the years to come. Even if college is over for you, the matter of money and your budget is still important, so it’s smart to learn about handling it early on. Setting limits for your spending and knowing how to maximize the amount you have in hand will help enable you to save you money. In turn, that money can be invested in other ventures, or kept saved in case of emergencies.