Saving money is hard for everyone, especially if you’re in college. There’s so many different ways to save and all these different options can be confusing. How much should I save? What are the best ways to save up the most money? How can I save if I have tuition, rent, a car payment, or other expenses I can’t put off?
Below I’ve compiled a list of ideas for college students to save money.
- Make a Budget
I know, I know. This is one that we’ve all heard. But as frustrating as it may seem creating a budget can be helpful. There are thousands of different types of budgets that you can pick from to accommodate the type of life you live. Once you have an understanding of how much money you have to spend every month on bills, versus how much more you are spending, it’ll be easier to see where you can save money. Do not spend more than you have!
2. Save Your Refunds
Whether it’s a tax refund or a school tuition refund, that’s money you can save. Rather than going out and spending impulsively on things you probably don’t need, save that money for when something comes up in the future. You never know when you’re going to have your car rear-ended or when a tree might fall on your house.
3. Open a Roth IRA
When talking to other college age students many don’t even know what this is. A Roth IRA is formally known as an individual retirement account. You might be thinking: why should I open a retirement account? I’m in college and I don’t even have a real job yet. The answer is you’ll be thanking yourself in forty years when you do retire. Roth IRA’s are great for young people because you can only contribute to it until you make over $118,000/year. Chances are few people in their early twenties are. You’re able to contribute up $5,500/year and earn interest on that money. These accounts are especially great because unlike traditional IRA’s there are no tax deductions for contributions.
4. Pay Your Interest
Since chances are you’re part of the forty-four million students in the US with student loans, paying on them early is in your best interest. Any unsubsidized loans you may have, start accruing interest from the time you get them. Although you’re not directly saving money, this option can help with saving money in the long-run.
5. Save on Food
As painful as it may be, your parents did get you meal plan for a reason. Commons may not be your first choice but when it comes to finding somewhere to live after graduation, your first choice is what you’re going to wish you saved for. So eat your commons for free and avoid eating Cookout or Chick-fil-A and save up for something great.
It’s important to remember that there is a purpose to your saving. It sucks to not be able to go out with your friends or to eat the food that you want, but in the long-run you’ll be happy that you skipped that late trip to WaWa and saved for that dream trip to the Bahamas.