Skip to main content
4 answers
4
Updated 938 views

How do I manage my finances while in college?

I'm not sure how much of my income should go towards my student loans (which will be about 65,000 dollars) and how much should go towards personal use
#financial-planning #college #finance #money #money-management

+25 Karma if successful
From: You
To: Friend
Subject: Career question for you

4

4 answers


1
Updated
Share a link to this answer
Share a link to this answer

Jorge’s Answer

Good morning college student,


I would like to start by congratulating you for the effort you're making towards getting a college degree and at the same time for being mindful of your personal finances and healthy financial future.


There is no single answer nor a unique solution to this, since every person's circumstances are unique.


I will suggest you to work towards doing an overall analysis of your own personal finances by building a budget, which will help you identify two key aspects, Money-in vs Money-out.

Money-in will be represented by all sources of income you might have, like a monthly allowance, part time job or your job when graduated.

Money-out will be the consequence to identify your "needs" (must have expenses) vs your "wants" (like to expenses).

Once you have identified if you have a positive balance, you can proceed and allocate a percentage to repay your loans and if any additional for savings.

Have in mind that if you have multiple debts (like your student loan and credit card debts), you should try to prioritize and re-pay first those who have the highest interest rate. If debts are overwhelming try to consolidate them and refinance them with a soft credit single loan (meaning a loan that might have a much lower interest rate and flexible payout term).

Don't forget to also work towards have an emergency cash reserve fund in place (like in a separate bank savings account), which ideally should be for the purpose of helping you pay for your living expenses (equivalent for an amount that might take care for a period of 3 to 12 months), in case you might face an adverse situation like being jobless or sick.

Hope this basic advice might be of help.

Sincerely,

George S



1
0
Updated
Share a link to this answer
Share a link to this answer

Keith’s Answer

So glad you are thinking about this now. I'd recommend keeping it very simple to start. 1) get a student checking account, 2) pick a "budgeting" method and keep it simple, 3) connect with a friend and budget together (helps make it fun, collaborative and helps hold you accountable to do it).

Keith recommends the following next steps:

Google "simple college budget template" and pick one you like
0
0
Updated
Share a link to this answer
Share a link to this answer

Simeon’s Answer

The two biggest expenses you can control are rent and food. I'd recommend finding a house rental near campus and splitting it between a group of roommates. You can get living expenses down very low this way and even split the cost of groceries with the house, taking different turns for who will cook, etc.

For student loans, pay the minimum payment on all but the highest rate loan. Any spare change you can afford to toss at that will be crucial. Then, as you pay off individual loans, don't lower the amount you're paying off on loans per month, but instead spend what you used to spend on old loans on the next highest interest loan.
0
0
Updated
Share a link to this answer
Share a link to this answer

Rey’s Answer

Is very important to develop a budget because it can assist you in reaching financial goals and avoiding debt. A budget typically includes income and expenses on a monthly basis. A good way of knowing where to spend money first is to classify expenses as fixed or variable. Variable expenses can be even further classified into necessities (needs) and non-necessities (wants). Fixed expenses are predictable as it will not change from month to month. This type of expenses are the one's you want to pay first. Variable expenses are those which change or are unpredictable. There are a number of ways to approach budgeting. There are strategies such as the 50-30-20 budget in which people allocate 50% of their take-home pay to fixed and needs, 30% to wants, and 20% to savings. The goal is to examine your financial situation on a regular basis and use this information to avoid overspending and/or debt.
Thank you comment icon Hi Rey: I found your comment to be on point and helpful to Kat. Good job! Sheila Jordan
0