Finances and Money Management

Who needs to worry about money management when mom and dad are footing the bill, right? Wrong! An unhealthy respect for money can lead to all sorts of trouble for college students. When it is your first time away from home, money matters can get quite complicated without a few pointers in the right direction.

Student Credit Cards

This has been an issue for many years. Credit card companies found an untapped niche when they preyed on college students. “Prey” is the right word. Giving a credit card with a high limit to a student without a job left their parents footing the bill and the student’s credit in ruins before they even entered the grown-up world of work.

Credit card companies and students are learning their lesson in money management these days. Credit cards have lower limits and more perks for the student who owns them. For instance, they can get deals on travel when they go home to visit the family on holidays and during the summer. Good grades also help them earn points towards discounts on merchandise.

The name of the game is responsibility. If you want a credit card, use it only for emergencies. It is a good thing to have in a pinch. But, get a job to pay the bill so your parents don’t have to get involved. Keeping your balance at a fourth of the total credit limit ensures that you won’t find yourself in a sticky situation at the end of the month.

Budgeting

This is a foreign concept to many students. Learning to budget in college helps by setting a good financial example for life after college. Use the money that you have wisely.

Let’s say that your parents offer you a monthly allowance while in school. It is easy for that money to disappear after a weekend or two of partying with friends or all-nighters studying for a big exam. If you know how much money you have for the next thirty days, dividing it up according to your bills and your wants is one way to end up with a little something in your pocket at the end of the month besides lint.

Opening a Bank Account

Many students have had full or part-time jobs at home so they know what it feels like to earn money. They also know about keeping that money (for however brief a time) in a banking account.

There are two types of bank accounts: savings and checking. In a savings account, your money will earn interest, no matter how slight. Just about every bank these days offers an ATM card for easy access to financial accounts. Unfortunately, this can lead to overspending and large overdraft fees if you don’t carefully track your spending.

It is wise for students to learn how to manage and balance their accounts so that they are not surprised at the ATM or at the checkout counter in a store. If they plan on using a checkbook, the free ledger that comes with a box of checks can be used to track checks written and money withdrawn by ATM.

Student Discounts

Student discounts save money. Many stores and restaurants offer students reduced prices with the presentation of valid student I.D. College students can save money at movie theaters, car rental counters, their favorite hangout spot and more. Many colleges give out this information along with discount coupons during freshman orientation.

What does your money situation look like? It is easy for it to slip like water through your fingers. Don’t find yourself away from home and broke. A few simple money management skills can save a lot of trouble.

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