Budgeting Tips for College Students: 18 Essential Tips You Must Know

Written By: Jenny Williams
Reviewed by: Mike Reyes
Last Updated February 2, 2022

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Managing money is hard, especially when it seems no one really knows what they’re doing and or has good advice. Nor is it something you learn in school. This means for many students, going to college is the first time they’ve had to think about budgeting tips and managing money themselves. And, without the knowledge behind what’s going on, the attempts are rarely successful and usually lead to debt.

Perhaps you’re in this category. Maybe you’re struggling with your money, or maybe you’re just trying to make yourself more financially stable, so money isn’t a stress. Either or, today we’re going to be exploring 20 essential tips you need to know that will help you manage and budget your money like a pro.

Essential Budgeting Tips for College Students

#1 – Create Yourself a Budget

The absolute first step in learning how to save money as a student is creating a budget that is both realistic and attainable. 

As a student, you wouldn’t be able to manage a full course load without some form of calendar or schedule, especially when it comes to exams and essay deadlines. You get yourself organized so you can manage your workload, and the same logic applies to your finances.

A budget is essentially a written version of a financial plan. There are plenty of resources out there and ways you could possibly make a budget, ranging from planning how much you’re spending per month and dedicating some to savings as you go or by following the 50-30-20 rule (check frequently asked questions).

#2 – Make Budget Adjustments as Needed

Hand in hand with the previous tip, while it’s vital that you create a budget and stick to it, that doesn’t mean you shouldn’t go back and review it from time to time. Life is complicated and will throw curveballs your way, and your budget will be tested and broken from time to time. With this in mind, you should keep coming back to your budget and reviewing it. This keeps it fresh and relevant. 

As a college student, you’re likely to experience a number of financial firsts, but for this tip, making budgeting adjustments provides you with the wonderful experience needed for you to learn how to handle money in your twenties, and therefore, the rest of your life.

Take some time after you’ve had a chance to work with your budget (at least six months) to see if the first budget you made is realistic and practical. Go back, tweak as you need, figure out where you are, and apply the changes. 

So many people ignore their finances and think that if they don’t look at them and pay attention to them, then it’s simply all going to be okay, but that just isn’t the case. Managing money requires honesty and attention, and this is one of the best ways to do it.

#3 – Track Your Spending Habits

This budgeting tip is, by far, one of the most basic yet most essential financial suggestions for college students is to keep track of their spending and habits. Get yourself a pen and paper or open an Excel spreadsheet and start writing down everything you’re spending your money on. Track your essential purchases and how much you’re spending on things that you don’t need to and start to understand where your money is going.

By understanding where your money is going, you’ll have the ability to make conscious choices about where you put your money in the future, therefore managing your finances better.

#4 – Read Books about Budgeting

College students looking for budgeting tips, or managing their money better will excel when they take the time to read something comprehensive or get information from someone who can offer real advice. This article is simply a list of tips to help point you in the right direction and give you a foundation to work from, but you can go much further than this.

Check out some of the best financial books for young adults online in your library, which will explain the many options for finding money that is expressly for students. Many scholarships (and other sorts of financial aid for students) are available, and students who qualify only need to fill out an online application. 

If you learn how to handle money in your twenties, you’ll be able to use it for the rest of your life as your budget and assets increase dramatically.

#5 – Work on Your Credit Score

Credit scores are essential in today’s world. Sure, you might plan never to take out a credit card or payday loan, but you still need a credit score for plenty of other purchases and investments in life, from everything ranging from a pay monthly phone contract to a house mortgage.

The thing is, if you never have a credit score and don’t set yourself up, then the lenders of such loans will give you a bad rate because they don’t know whether you’re going to be a risk or not. When you’re young, you want to give yourself a decent credit rating so you get decent rates and can be the best you can be.

The best way to do this is to take out a small credit card then use it to purchase a small recurring payment that comes out monthly, like a Netflix subscription. Basically, you’re making a payment that there is basically zero chance of you overpaying and draining your credit card balance. Then simply pay off the small amount each month, and it will show your credit rating rising because you’re taking steps to take credit and pay it back on time.

Read more: How to Improve Your Credit Score

#6 – Be Cautious of Identity Theft Prevention

Identify theft and money scams, especially online, are dangerous and can come from anywhere, which is why it’s so important to keep your wits about you. There’s nothing worse than having your data posted online or sold to someone else who will use your details for malicious purposes. It can be such a nightmare to get everything to reset and recovered after this has happened, which is why it’s so important to avoid it happening in the first place.

Statistics show that student loan-related identity theft has increased dramatically in recent years, according to the Federal Trade Commission. Use a free credit monitoring service, change your passwords frequently, and check your bank account.

Read more: How to Prevent Identity Theft

#7 – Open a Savings Account

We’ve spoken a lot about savings account and saving your money for the future, and this isn’t entirely possible unless you have a savings account. Sure, you could technically keep all your money in one current account, but the risk of spending it accidentally is too high for the vast majority of people.

Ideally, you want a savings account that you can open and pour your savings into. This way, you can forget about the account, and you won’t be tempted to spend the money. Just leave it alone and forget about it. Let it build up, and over the years, you’ll have considerable savings where you’ll be in a position where you’re always financially secure.

#8 – Avoid ATM Bank Fees

Banks are always out to make money, so keep a bit of mindfulness and focus on yourself, and you’ll avoid paying fees where you don’t have to. Some of these fees include things like ATM charges and bank surplus fees. Even just walking down the road to a free ATM might not sound like much, but over the course of your life, these fees can add up considerably.

Avoiding bank trash costs, such as ATM fees, is one of the simplest methods to learn how to save money as a student. Avoiding unnecessary ATM fees is one of the most basic financial advice for young folks. If you must withdraw cash from an ATM that costs a fee, make sure you withdraw a large enough quantity to avoid having to use the ATM frequently. You will realize the usefulness of this financial advice for college students in the coming years.

#9 – Watch your Coffee Purchases and Eating Out Costs 

A really simple way to remember this is not to buy food or drink from a stranger. Okay, you need to live your life, and as a student, you’re going to want to eat out with your friends and have coffee study dates with that guy or girl you think is cute, and there’s no reason you can’t enjoy these luxuries.

However, indulging in this way all the time will leave you financially unstable, so consider your options of how you can live more affordably. This means buying from a supermarket and putting your own food together or taking full advantage of the affordable student cafeteria where you can use your student discount.

However, the most golden rule to remember is to not eat your roommate’s food. That’s just inexcusable.

#10 – Open an Amazon Prime Student Account or Similar

While on the subject of student discounts, there are plenty of organizations out there that offer student discount programs, so you need to make sure you’re taking the time to discover them and then take advantage of them. For example, an Amazon Prime Student Account can save you so much money on things that you need to buy.

This kind of account will give you discounts on all your college essentials and will even provide you with a phone number to call to earn money. This continues to apply to eating out (where some restaurants and bars will offer student discounts), gym memberships, and Spotify accounts.

#11 – Use On-Campus Facilities

There’s no doubt that most college campuses provide subsidized or free access to the school’s gym, athletic, and aquatic facilities to students. One of the simplest saving money strategies for young adults attending college is to make use of everything the college has to offer to its enrolled students since this helps them to save the monthly cost of a gym membership. 

Some colleges even provide discounts to the families of students, so it’s all worth looking into.

#12 – Purchase Used College Textbooks and Sell Your Used Books

Students who want to learn how to save money as a student will find that buying used textbooks online or at the college bookstore is a surefire method. 

This is one of the most straightforward money-saving techniques for young adults and college students. Used textbooks are frequently in as good a condition as new textbooks but at significantly reduced prices, resulting in huge savings.

“Do your research and see what works for you, and that really is the trick to saving money. It’s not about following a strategy word-for-word but instead creating an approach that works for you and your life,” shares blogger, Alani Jones.

#13 – Consider Your Housing Options

How are you living as a student, and how much are you paying for where you live, and how can you save money in this area? There’s no doubt that accommodation is one of the most expensive expenses in your life, so take a moment to think about your approach.

Could living in on-campus accommodation be more affordable than off-campus living, such as living in a flat or apartment? Typically yes, but not always. If you can move into a house with roommates and split the cost of living, then you’ll be spending way less than if you were living on your own, so it’s well worth thinking about.

This applies to all aspects of living. How can you split bills? Can you stop using so much electricity and save on your utility bills? Always be looking out for ways to save money with your living situation because combined, you can save a lot.

#14 – Set Yourself Financial Goals

With your education, the chances are you’ll set yourself goals, so you have something solid to aim for. This is the importance of goals. With your grades, for example, you may have goals for your grades and goals for your essay marks. The goal you’ll be happy with should you achieve it. The same logic applies to your finances, and by setting yourself goals, you’re going to be able to focus up and have something to be motivated towards.

So, set yourself a long-term goal. How much money do you want in your savings account by the end of the year? Is there anything you’re explicitly saving for in your life, such as a vacation, a car, or a new computer? Perhaps there’s an event or festival you want to treat yourself to after your work year is done? Your financial goals don’t have to be serious in this sense and can be something to look forward to.

The most important thing to remember is that you’re setting yourself something to aim for since this will help you stay on track and stay motivated towards making things happen.

#15 – Consider Ways of Earning Money

While a lot of these tips have been for college students saving money and budgeting, that doesn’t mean you can’t take things a little bit further by thinking of new and creative ways of making money. The more money you have, the more you can save, the more you can spend, and the more comfortable you’ll be.

And there are plenty of ways to earn money as a student, as long as you’re willing to think outside the box. Perhaps the most obvious way to earn money is to get yourself a part-time job, but this is basic. Nowadays, you can start your own little side hustles doing something creative, or you could write and release an eBook or start monetizing a blog as a way of making money about something you care about.

I know many students who are creatively gifted in things like knitting, sewing, and arts and crafts, so they will make things to sell and fulfill custom orders on websites like Etsy. You could tutor someone if they’re not sure about what they’re doing, or you could help someone learn English as a language tutor if it’s not their native language.

Just avoid what is known as ‘lifestyle creep’ (which is the more you earn, the more you spend, effectively keeping yourself in the same financial place no matter how much or how little you’re earning), and you should be better off over the long-term.

#16 – Use Technology to Help

It doesn’t matter whether you’re trying to save money, trying to track your spending, or you’re setting up bank accounts and managing your payments, there are a ton of technological services out there to help you get the job done easily and right. 

For this budgeting tip, college students can download an app to track what you’re spending daily, and download your bank’s mobile app so you can stay in touch with what you’re spending your money on and when. Just make sure you’re researching which app will work for you, and you’re not spending money on a premium service that will actually end up costing you more in the long term.

#17 – Pay Off Debts First

Whenever you take out money, you’ll be charged interest on what you owe. This is how lenders make money. You borrow $100 and pay back 1% interest over the year, and they make $1 on you. Of course, the interest rates are more like 10% or higher, and you’ll be charged monthly, which means the longer you have the loan, the more money you’ll end up paying back.

To save money, you always want to pay back your loan or debt as early as possible, so you’re paying the least amount of interest. This is one of the most powerful ways to save money over the long term, and it’s always a good habit to get into. 

This includes all loans, such as your phone contract, your mortgage, your student loans, and your credit cards. Just get into this habit, and it will benefit you massively over the course of your life.

Read more: How to Pay Off Debt Fast

#18 – Use Coupons

Okay, couponing does not sound that cool, and you probably have images of elderly people doing this to save pennies, but couponing actually works if you do it right. And at the end of the day, why would you pay full retail price for everything when you can literally spend a little bit of time on couponing to save a fortune. 

There are plenty who does this full-time and save a ton of money, literally buying hundreds of dollars worth of shopping for as little as $40. For this budgeting tip, financial experts claim that casual couponing will save college students around 20% on their bills, which means you can then afford money on other things in your life that matter to you.

Frequently Asked Questions

What is the 50-20-30 Rule?

This rule takes your paycheck and breaks down what you’re doing with it and how you’re allocating your cash, student loan, or any other forms of income you have. You do this by putting 20% into your savings, spending 50% on your essential bills, and then giving yourself 30% to do with whatever you want.

What’s the Number One Rule When It Comes to Budgeting?

If you could narrow down budgeting to just one rule that you’ll take with you, it’s this. Always follow your plan. It can be so easy to let yourself go when something comes up, like overspending on a night out at a bar or buying a new computer game, but you have to be strict and disciplined with yourself if you want the process to work.

What’s a Decent Monthly Budget?

While the definition of a decent monthly budget can vary dramatically depending on where you are in the world, if you’re in the US, the average budget sits around $200 per month, according to collegeavestudentloans.com, or just over $2,000 per year.

How much Money Should a 20-Year-Old Student Have Saved Up?

As a general rule of thumb for life, you should save around 20% of your earnings for your retirement. As a student, you’re not really expected to have any savings since you’re living your life. However, if you’re working full-time and say you’ve been working for an entire year, you should have around $6,000 in savings.

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