They say that money can’t buy happiness, and while I agree, I also know that money troubles can definitely cause some major unhappiness. As part of the increase in independence that comes with college, managing money can be a real test of will power. All of us have different spending habits. Do any of the following sound familiar? Which scenario is closest to how you think about money?
That’s what credit cards are for!
“I get the best of all worlds – not having to work, having time for all my school stuff and my social life, and getting to buy whatever I want! I’ll just deal with the bills after college…after I’ve moved to Antarctica where they won’t be able to find me anyway…”
I’ve got three jobs
“I like to buy whatever I want! I want to spend my hard-earned money. It’s too bad that I don’t have time for anything else like getting an internship or joining that Pre-Med society on campus, but right now, I just have to work.”
Saving up for those shoes
“I am waiting to buy those shoes! I am super stoked to have them, but I’ve gotta wait until I get my paycheck… Yeah, maybe I could have worked more hours, but I just have so many other important things going on with my classes, my campus leadership roles and that marketing campaign I am helping Professor Smith with.”
You’re smart. Obviously the last scenario is the ideal. The first two scenarios are very common for students because it’s so easy to just think, “Well, I’ll worry about the bills or make up for lost time after college,” but here’s the thing: You are never going to get your college years back, and NOW is the time to take advantage of those years and set yourself up well for your future!
So, take some time to think about your budget. First figure out exactly what expenses you have every month. This could be as simple as writing them down on a piece of paper, or using an online budgeting tool. Remember to be realistic – list out everything that you spend money on, including dinner out with friends, lattés, transportation costs, club dues, and of course, the basics like meals, books, housing, clothing, tuition, etc.
You might find a few surprises once you add it all up. If the total makes you gasp out loud, take a moment to breathe, and then reevaluate: What total would make you feel more comfortable? What are you willing to cut out to make it happen? What is a realistic budget goal to set?
Next, capture the sources of income do you have coming in. A job, an allowance from your parents, a savings account maybe? Does your income cover your expenses? Do you have enough income to have a little buffer for an emergency, or for things like holiday gifts? Even if your income does balance your expenses, if you’re spending a ton and working a lot, take some time to re-evaluate whether you can cut back on your expenditures to free up time that you can put towards other important endeavors.
If managing your spending habits is a challenge there are lots of tools to help you out: You can go high-tech using tools like www.mint.com, that help you easily set up systems of text or email reminders if you overspend or overdraw, or you can do something more low tech like withdrawing your weekly spending money from your bank account every Monday and not buy anything else once you’ve blown through the cash in your wallet.
While dealing with finances might not be the most fun thing in the world, you are building a skill that will truly benefit you for the rest of your life. And that is truly priceless!
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