Back to School Budget Basics for College Students
Posted on: 09/07/2018 at 8:00 a.m.
For college students, summer vacation is over and school is back in session.
You’ve said goodbye to your extra free-time and your summer job, which likely means less cash in your pockets. Working full-time during the school year typically isn’t an option for most students, meaning part-time jobs are the way to go.
Budgeting is incredibly important no matter your job situation. If you don’t currently have a budget, read this blog first. Even if you do have a set budget, it may look different during the school year than it does in the summer. That’s why we suggest a little budget refresh.
If you’re a student working part-time, here’s how to make the most of your money:
Decide What’s Essential
Some expenses you can’t live without. These are sometimes called the “Four Walls”: food, shelter, basic clothing, and transportation. When creating your back-to-school budget, it’s important to figure out how much you’ll owe each month on essentials and place them above non-essentials (such as grande vanilla iced lattes) on the priority totem pole.
Expenses that change from month to month are known as variable expenses. These include things like gas, utilities, groceries, and entertainment. Unlike your rent and loan payments, you can’t always predict how much these will set you back, but you can make an estimate.
Don’t Forget Savings
Even if you’re only working part-time, setting aside some money in a savings account is essential. Think of savings as just another bill – automate it and forget it. If you never saw the money, you won’t miss it.
Saturday night drinks with friends and tickets to your favorite band in concert aren’t no-nos, but they are negotiable. Expenses like these are known as non-essentials, and you can figure out what goes into this category by asking yourself, “If I don’t buy this, will my quality of life go down?” If the answer is “no,” it’s non-essential.
Add Up Your Outflow
Take your essentials, variables, savings, and non-essentials and add them up. This number is how much you can expect to spend each month. Now, subtract it from your monthly income. If the number is positive or 0, you’re good to go! If it’s negative, keep reading and we’ll get you there in no time.
Take Small Steps
Take a hard look at your non-essentials and start crossing things out. Small changes lead to big savings, so even if it means eating out less, your wallet will thank you. A few ideas of things to cut out:
- Personal care: nail appointments, hair appointments, massages
- Food and drinks: restaurants, alcohol, snacks, coffee and energy drinks
- Clothing: shoes and accessories
- Subscriptions and memberships: Netflix, cable, Spotify, gym memberships
Save on Essentials
Our essential expenses can’t be cut out, but sometimes they can be minimized. For example:
- Get a roommate to save on rent
- Research ways to save on utilities: turning out lights, washing clothes in cold water, unplugging devices
- Move somewhere more affordable
- Look for coupons and shop the deals in local grocery stores
- Carpool or take public transportation
Increase Your Inflow
If cutting back on expenses isn’t an option, look for ways to make money without getting another job. If you’re a great writer or graphic designer, freelancing might be an option. If you know a few families in the area, offer to babysit. If you really love a certain subject, become a tutor or teaching assistant. Sometimes the best option isn’t to decrease your outflow, it’s to increase your inflow.
Juggling school and expenses can be difficult, but it’s not impossible. Taking the time to give your budget a refresh pumps up your bank account and improves your money management skills. Just think of how much better off you’ll be once classes end and you land a full-time gig.