MONEY MANAGEMENT TIPS FOR STUDENTS

1. CHOOSE THE MEAL PLAN THAT WORKS FOR YOU

Many colleges allow students to choose a plan for meals eaten in the dorm’s cafeteria. If you have a choice of meal plans, make sure you’re using the right one for you. An unlimited plan may tempt you to get your money’s worth in food, even though you’d be satisfied with lighter fare. If you’re on a limited plan, but often hungry, consider switching to an unlimited plan. The increased cost can be balanced by what you save on expensive snacks.

Most importantly, if you have a meal plan, use it! You’ve already paid for the food. Don’t pay again to eat somewhere else. 

2. SAVE ON SNACKS

Avoid buying sodas and snacks out of vending machines or from convenience stores. Instead, buy snacks at the grocery store and keep them in your room. If your dorm allows you to have a small microwave or refrigerator, share the cost with your roommate and buy snacks in large quantities to keep on hand. This way, you can stash some food in your backpack before heading to class and can avoid more expensive, less healthy options. 

3. TALK TO YOUR ROOMMATES ABOUT MONEY ISSUES

Making a roommate relationship work for everyone requires planning, commitment, involvement, and sometimes, hard work. There are many advantages to having roommates—companionship, friendship, and the opportunity to share expenses and responsibilities are just a few of those advantages. But there can be a downside too—for example, if you find out too late that your roommate never pays his or her bills or is reckless with property. For these reasons, it makes sense to sit down and set some ground rules prior to moving in. One of the ground rules should be about money. Talk to your roommate about how you will share the costs of things you might need for your room, how you’ll handle shared bills, and what your policy will be about lending money to each other. A hint: It’s probably better not to lend money to your roommate or anyone else. You’ll avoid a lot of hard feelings if someone doesn’t pay back the money. 

4. SET GROUND RULES REGARDING MONEY

Talking to your roommates about money issues is especially important when you have an apartment because there are many more issues involved. Make sure you and your roommates are very clear about how you will share the costs of everything. Here are some examples:

• Will you shop together and split the food bill, or will each of you buy your own food?

• How will you share other household staples like groceries and other supplies?

• What if one person wants to turn up the heat and the other wants it down?

• What happens if one roommate damages the apartment and the landlord refuses to return your security deposit?

• What will you do if one of your roommates moves out before the lease expires?

These are important issues that could end up costing a lot of money. Discuss these situations with your roommates before a problem comes up. Even better, put your agreement in writing and have each roommate sign the agreement. 

5. RESIST PEER PRESSURE

Many students report that they sometimes feel pressured by college friends to spend money that they don’t have. A few strategies to deal with the situation include:

• Write down your long-term goals and how a college education will help you reach them. Read this list often to remind yourself why you have made the financial commitment to attend college.

• Go with your friends to free or low-cost college events, such as lectures, dances, sporting events, and movies.

• Keep track of how much you spend on everything. If you’re spending more than you can afford, make changes. The spending plan worksheet on pages 27-28 can help.

• Be willing to say “No, I can’t afford to do that.” Many students don’t have much money, but sometimes they are unwilling to admit it. Your willingness to be honest and live within your means sends a strong message to your friends that you are both confident and responsible. 

6. SEPARATE NEEDS FROM WANTS

To save money, it helps to really understand the difference between needs and wants. And you probably do understand that food is a need and a latte is a want. But some mornings, after cramming for a test or working late, a latte is sure to feel like a need. Maybe coffee is a need but gourmet coffee drinks are a want. Maybe a cellphone is a need for personal safety but custom ringtones are almost assuredly a want. When spending your money, think about what’s really important to you and what has lasting value. Considering needs and wants should help you identify ways to save money and meet your goals. 

7. KEEP TRACK OF YOUR SPENDING ACCOUNT

Some colleges set up special spending accounts for students. When you put a certain amount of money into the account, you receive a card to use to make purchases for food, services, and other items around campus. These student accounts are handy, but watch out! It’s easy to lose track of how much you are spending.

One idea: Get a small notebook and write down the cost of everything you buy with your account, just like you would write down every check you use. That way, you’ll know at a glance how much you’ve spent and how much you have left. You’ll also have a record in case of mistakes. 

8. PLUG EVERYDAY SPENDING LEAKS

It’s often the small purchases you make without thinking twice that add up over time. To avoid this, keep your money in the bank instead of in your wallet. The less cash you have handy, the less tempted you will be to spend it.

Here are a few other ways to stretch your money while you are in school:

• Cut out costly habits, such as smoking cigarettes or buying expensive coffee drinks.

• Shop at thrift stores, garage sales, or flea markets for everything from furniture to sports equipment.

• Avoid rent-to-own stores, pawnshops, and check-cashing stores. They will end up costing you a lot in the long run!

• Make a shopping list and stick to it so you won’t spend on impulse. Clip coupons to save even more.

• When possible, use your bike instead of your car. You’ll save on gas and parking expenses.

• Limit the number of songs and ringtones you download or avoid the expense completely!

• Go to free on-campus movies or check out DVDs from the library. 

9. CREATE A BUDGET AND STICK TO IT

One of the best ways to keep track of your money is to use a spending plan or budget. Think of a budget as your financial map. It tells you exactly how much money you have coming in every month, where you must spend it and where you might be able to save a few dollars.

Income and expense worksheets are provided at the end of this booklet. Make several copies of them so you can fill out a new one whenever your financial situation changes. 

10. PAY THE RENT ON TIME

If you opt for an apartment, always pay the rent on time. This will help you build good credit. However, if something unavoidable happens and the rent will be late, call your landlord immediately. Explain the situation and try to make at least a partial payment by the due date. Then, give the landlord a definite plan for paying the rest. If your lease says there is a penalty for paying late, expect to pay it. If you’re really short on money, ask the landlord if you can do some chores (hard work, exterior painting, odd jobs) to pay for part of the rent. Or, see if your landlord is willing to accept lump sum payments if you receive financial aid refunds each term. That way you can pay your rent for a certain number of months up front when you have the money. Keep communicating with your landlord and be honest and realistic about your situation. Keeping the lines of communication open will go a long way toward encouraging your landlord to work with you on this problem.