College: a time of new beginnings, exciting opportunities, and often first-time responsibilities. Sometimes, the overwhelming school, work, internship and/or social load can mean important things like finances don’t get enough attention. While you may be focusing on midterm exams and Halloween parties, now is a great time to take a break and look at where you stand with your financial checklist. Are you keeping spending in line with your budget, income or allowance? Do you have goals for the future (like buying a home or moving to a new city)? Since a personal finance class probably isn’t on your schedule this semester, it’s a good idea to set a time for that midway money check.
Balance the Budget
Keeping track of your finances can give you a clearer idea on what you’re spending, what you’re saving and how it all affects your goals. Once you are settled into the routine of the semester, it’s important to evaluate your budget or develop one if you haven’t yet. A well-rounded college budget takes cash flow in from income, allowance or loans as well as cash flow out on things like tuition, rent, groceries, entertainment and social costs, transportation, travel home, car needs, books and supplies. Even if you do your best to stick to your budget each month and semester, you may find yourself going over. This is a sign you need to re-evaluate it and possibly make changes in your spending patterns or income amount.
Check in on Goals
Even as you embark on this adventure, it’s a good idea to think about your next phase of life and future financial goals. Figuring out where you stand on student loans can help give you a jump-start on managing debt and give you an idea of what your post-college budget will look like. Learning about your monthly payments will help you make realistic targets for other aspects of life. Maybe retirement funding and insurance seem like far-off needs, but you can still set checking, savings and emergency fund goals for each month or semester and check in on your progress regularly. It’s also smart to check your credit. Your credit standing (you can get a free credit report summary from Credit.com if you’re not sure what your credit profile looks like) can affect where you can get an apartment and how much you pay for car insurance as well as whether you can get a loan or credit card.
Learning and using good money habits will probably not happen overnight. Consider turning to peers, parents, advisors or even teachers for money strategies and savings or budgeting tips. It can be helpful to take a minute and ask what they have done that has worked well for them and then apply that on a smaller level to your financial efforts. This can also help you set new goals. You may want advice about if you need a credit card, what banks you can trust for savings and checking needs, how to protect your financial information, what you can expect to earn, what taxes usually amount to and even how to invest shrewdly. The Internet also has a ton of great resources so it can be a good idea to invest some time in researching on your own. Just make sure you are seeking out credible resources.
Even though college may seem like the time to be broke or live free of financial stress, it’s a good idea to take this time to get ahead, or at least not fall too far behind (in debt). Learning how to make smart fiscal decisions now can set you up for a better transition to the real world and more success down the road.
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