As you prepare for a new year at college, managing your money may be the last thing on your mind. Maybe you're more focused on registering for courses or getting to know your classmates. College is a time for new experiences and personal growth, and sometimes it seems as if you learn as much outside the classroom as you do from your professors. But, college is also the perfect time to instill strong and healthy financial habits, such as budgeting and living within your means.
By starting on the right foot with good saving and spending habits, you'll have a good chance to set yourself up for a life of financial success. Practicing good habits takes discipline and thought. Here are some ideas to consider for students -- with the help of parents, relatives and the school's financial aid office -- to take the leap into living away from home.
Create a financial plan early on. Some students start preparing for the long term cost of college by choosing a less expensive school, such as an in-state public university over a private college. Regardless of whether or not you took this approach, you can apply for scholarships and grants throughout your college years.
Even if you have financial aid, most college students need to be frugal as they balance major expenses and a limited income from a part-time job or support from parents. In 2014, about 70 percent of college graduates had undergraduate student loan debt at graduation according to The Institute for College Access and Success. While loans may be a necessity, the better you manage your personal and educational expenses the less you'll have to borrow now, and repay later.
With the help of your parents and resources available online and in person through the government, financial institutions, non-profits or even your school, create a general financial plan for your college years as soon as possible. Also create a more detailed budget for the upcoming semester. If your family works with a financial advisor or counselor, it could be a good idea to enlist his or her help.
You can start with estimated costs for tuition, fees, room and board from your school's financial aid office, where you can also ask for additional advice, and fill in the actual numbers once you know them. If you're still in high school, ask your school's college counselor for advice on fees, tuition and other financial considerations for college.
Adjust your budget as you go. Your focus when at school should be on your course work, but you can also take time to track your expenses and stick to your budget. A budget, especially when working with limited resources, can be a practical tool and a learning opportunity. Particularly during your first few semesters, you'll likely have to make adjustments as you discover how to balance wants and needs. It's okay to make changes (and an occasional mistake) as you go, but try to continually forecast and track your income and expenses.
Parents can be a valuable source of support during these years. They you can share how they manage your personal or family budget and offer suggestions for how to find work or save money. College students may also face a lot of financial firsts, such as signing a rental agreement, purchasing renters insurance or applying for an auto loan, and parents can share their experiences and advice.
Make your budget add up. At its core, a budget is remarkably simple. It records your income, expenses and what you have leftover. If you're having trouble ending the month with a positive balance, look for ways to increase your income, decrease your expenses or both. While the specific tactics you use may vary depending on your stage in life, learning how to roll with the punches and live within your means are timeless skills.
To increase your income, you will likely have to balance academic obligations with a part- or full-time job. You might be able to get a flexible on-campus job working for one of the school's departments if you have a work-study grant as part of your financial aid package.
When it comes to saving, there are also are all sorts of ways to cut costs on necessities and indulgences. Consider the following three tactics almost any college student can use to spend less money.
•Use student discounts. Dozens of stores offer students discounts, validated with an official ID, or a .edu email address. Students can save 10 to 20 percent at many clothing stores and get a discount on hardware and software from popular tech companies. Many sports teams, theaters, hotels, museums and restaurants also offer student discounts.
•Save on textbooks. According to the College Board, textbooks and supplies can cost undergrads at four-year schools nearly $1,300 a year. Look for alternatives to buying brand-new textbooks, such as buying a used book at your campus bookstore or online, sharing with a roommate, renting the textbook, purchasing or renting an e-textbook or using the library's reference copy.
•Mobilize your savings. If saving money is just one more thing you don't want to think about, you can save your spare cash via your smartphone. Thinking about buying a car next summer or saving money for spring break? There are mobile apps that will calculate how much money you can afford to save at a given moment -- whether that's $20 or ten cents -- and will save it for you. You could also set up an automatic weekly or monthly transfer to your savings account through your bank. Chances are you won't miss the money, and you won't spend it if you don't see it in your checking account.
Make a practice of saving for the future. When your budget is in order, you'll also want to figure out the best way to use your savings. If you've taken out student loans, you could allocate some of the money to early loan payments.
You may not have to make a payment until after you graduate, but private and unsubsidized federal student loans accrue interest while you're in school. Making a payment can help you avoid increasing your debt load and save you money on interest. Plus, unlike with some other types of loans, there's no penalty for making early student-loan payments.
Bottom line. College is an ideal time to instill healthy financial habits. Ask your parents or other relatives for guidance, discuss student loans and budgeting with your college's financial aid office or with a financial advisor, learn a new skill online or attend a local personal finance workshop or seminar. While you set off on a series of firsts, take advantage of these resources to learn how to manage, save and wisely spend your money.
Nathaniel Sillin directs Visa's financial education programs. To follow Practical Money Skills on Twitter: www.twitter.com/PracticalMoney
This article is intended to provide general information and should not be considered legal, tax or financial advice. It's always a good idea to consult a legal, tax or financial advisor for specific information on how certain laws apply to you and about your individual financial situation.