5 Tips for Organizing Your Finances Before the School Year Starts

Before we know it, we’ll be (tragically) back in lecture halls and seminars, dutifully taking notes and gazing at new campus crushes. Between classes, social engagements and the return of your favorite fall TV shows, there’s no time to be worried about your budget, credit, loans or other money-managing matters.

To help you make the most of a new school year, we reached out to financial expert Kimberly Palmer, author of Generation Earn: The Young Professional’s Guide to Spending, Investing and Giving Back, as well as some financially-savvy collegiettes. Read on for tried-and-true advice for keeping your finances so well organized that you barely have to think about them at all!

1. Do your research

We know, we know. It’s summer, and the last thing you want to do is work! At some point in life, though, you will have to know about things like taxes, insurance, interest and credit, so becoming familiar with these topics now will only help you in the long run.

Talk to your parents, your local bank teller and even your friends, who likely have very helpful tips about avoiding financial missteps and suggestions for financial improvement. They’re going through the same things you are, so why not lean into them for advice?

There is also a plethora of information online about money management, in addition to books and other resources geared toward young people and their financial preparedness. Give these a try, and you’ll be well-versed in fiscal matters in no time!

  • FinancegirlThis website was started by Natalie Bacon, who graduated from law school with over $200,000 in student loan debt and realized she needed to make some serious changes. Her website is geared towards young women in particular and has pages that cover every financial topic imaginable, from side hustles to the envelope system.
  • Financially FearlessWritten by Alexa Von Tobel, this book breaks down the complexities of money management for the average young person. Via the “50/20/30” method, this book instructs you to spend 50 percent of your money on necessities, 20 percent on savings for the future and 30 percent on whatever you wish!
  • Debt-Free by 30: Practical Advice for the Young, Broke and Upwardly MobileThis quick read is chock-full of financial tips and tricks that you don’t need a business degree to comprehend. It was written by Jason Anthony and Karl Cluck, two young men in their 20s who found themselves deep in debt after graduating college with no idea how to turn their financial situation around. They basically did the work for you so that you can avoid the same risk.

Specific research should be done on your bank and any loans, insurance policies or credit cards that you might have. This way, you can learn about insurance rates, deductibles, minimum payments and repercussions for not following through on any of the stipulations of your financial arrangements.

Each person’s financial situation is different, so you will have to be more involved in the research. It may even entail talking to actual people (like your insurance agent, doctor or personal banker), but it’s all worth it!

Related: 9 Ways to Make Extra Money Before the End of the Summer

2. Go through your past budget

Unless you want to be an accountant, this is probably the least fun money-related task you could do. Going through your budget means facing the harsh reality of what are probably less-than-perfect spending habits. However, it also means becoming aware of where you can improve these habits.

Before you go back to school, review your spending from last year via your credit card and/or bank statements. Categorize your spending into groups like travel, school or entertainment, and split them up by month. Excel makes this kind of work really easy, and you can even jazz it up with fun colors and charts (which will hopefully make the whole process a little less painful!).

Sarah Silberstein, a senior at the University of Texas at Austin, says, “I averaged out my bills so I knew what I was spending…and tried to find places I could scale back.” Simply becoming more aware of your money and where it’s going is a great step in the right direction towards better money management.

3. Make a new plan (and stick to it!)

Incorporating a concrete financial plan into your routine is a great idea. For example, you might want to try keeping a weekly journal of where exactly your money is going and how much of it is going there. Apps like Mint make this even easier, and track your spending on credit or debit cards along with other finance accounts to give you a picture of your finances right on your phone—and even let you know when you’re getting near your spending limit.

Palmer recommends making “a simple list…of all of your expected costs and income” on Excel or even by hand so that you have a solid, clear idea of your resources. “Then you can make sure you are prepared to afford all of your expenses each month,” she says. And you can easily plan for any surprises from your budget!

If you’re a little swipe-happy and need to wean yourself off plastic, maybe you should give good ole cash a chance. Sarah suggests that it might be “easier to control spending when using cash” because it’s more difficult to go on a spending spree when you can actually see the cash pile decreasing (as opposed to a credit or debit card, which makes money seem very abstract and like it exists infinitely).

In addition to practicing beneficial new habits, see if you have some current tendencies that aren’t so wallet-friendly. Palmer says “you can probably scale back” things like coffee and takeout in favor of eating in and entertaining friends at home rather than spending money on a night out. Check out HC’s list of even more helpful financial habits that will save you stress, worry and money!

Related: 19 College Women Get Real About Money on Campus

4. Make sure loans and bills are taken care of

Darsheene Vital, a senior at Howard University, says to “always pay more than minimum for your bills,” which not only looks good to your creditor, but will also pay off in the long run (literally!) when your payments end earlier than anticipated and you don’t have to worry about even more fees because you missed a payment or came up short. Paying more than your minimum gives you a kind of financial insulation.

Palmer says that another important factor related to paying bills on time has to do with building good credit. If you aren’t careful about being timely with loan payments, “any lapses can have long-term repercussions, by hurting your credit score.” This would mean trouble in the future with loans for a car, a house or anything that the bank might need to see that you are responsible enough to be trusted with their money.

Doing the work of organizing loans and bills is very nitty gritty, and the Federal Deposit Insurance Corporation (FDIC) has compiled a guide for young adults to avoid financial pitfalls in this arena because banks and other loan providers are quick to scam those less financially aware out of money. This resource recommends staying in contact with your lenders and best practices for obtaining and managing student loans. 

If your parents are involved with your finances, get in touch with them before you go back to school. Ask them about the status of your payments on tuition bills, insurance policies and loans you may have cosigned with them. If you aren't aware of what bills and loans you are responsible for (or will be in the near future), check in with whomever is currently responsible so you can start to prepare.

Start your fall semester off on the right foot and try to pay off your cell phone, car or health (or any other) insurance, and maybe even the minimum payment on your debit or credit card! Having this weight off your shoulders will make for a great school year.

5. Consider investing

If you’ve done all of the above but want to do even more money managing, why not consider growing your assets? One option is to keep your money in a savings account, where it will grow at a given interest rate. You also have the option to invest your money in stocks and companies you think are growing. If you have some money left over from a summer job or internship, investing might appeal to you.

If you are not so willing to gamble but have a comfortable enough budget to do so, Palmer proposes placing “money in some kind of diversified fund.” This essentially means putting your money in an investment portfolio that spreads out your capital to many different potential sources of growth. A financial portfolio is just a given amount of money (generally called assets) and is designated to be grown through investing.

By using an investment portfolio, you decrease the risk of placing a big investment in one area that might not have the potential for a large return (and may even result in a loss). Palmer also adds, "You only want to do this if you have the flexibility to not use the money for several years." Don't want to put all your eggs in one basket!

“When you head into a new school year, a lot is changing, including your cash flows, so you want to be sure you stay on top of it,” adds Palmer. You’ll be happy that you did when you have three term papers due, an oral presentation, and a group project but no random alerts from your bank about unpaid bills to add to that mountain of anxiety!

Essentially, just be smart and don’t be afraid to ask questions about financial matters you don’t understand. It might seem like everyone around you knows what he or she is doing with regard to their money, but that totally isn’t the case. We’re all just faking it till we make it! One day, we will be Beyoncé waving a fan made of hundreds without a financial care in the world.