Are you tired of being a broke college student? I feel like I am at the point in my college education where I have hit the point of classifying myself as a broke college student. The stereotype of being a broke college student is plagued with expectations of eating ramen and being an avid penny-pincher. While I don’t like stereotypes, I have started to find myself eating cheap mac and cheese cups when I am low on meal swipes and flex dollars, and looking for the best sales when I am shopping in stores and online. I definitely take advantage of any opportunities to go home for the weekend and work my high school job to make some extra money. Despite this, I would call myself financially literate. To me, being financially literate means having the skills and knowledge to manage your money effectively. This means knowing how to budget, save, and borrow efficiently. Being financially literate also involves being able to make informed decisions about your finances, track your spending, build and maintain good credit, and set financial goals for the future. I am going to share different things I do to be financially literate, and advice for how you can be as well! The National Endowment for Financial Education has some appreciable tips about many aspects of money management for college students!
https://www.nefe.org/initiatives/40-Money-Management-Tips.pdf
For starters, trying to have a source of income in college is very important. Whether it’s an on-campus job, a job that is walking distance from where you live, or a job back home that you can work while on breaks. In my case, I kept my high school job when I went to college and I am able to work there any weekends I am free and on all of my breaks. It is important to have a source of income especially if you don’t have any money saved up. Make sure you look for available on-campus or local job opportunities, even if it’s just for a few hours in your schedule. You could even look for paid internship opportunities that may tie into your career path later in life. Having a source of income will make a huge difference for you.
Living within your means in college is extremely important as well. Living within your means means avoiding unnecessary expenses and making smart decisions when purchasing something. This is difficult for me because I enjoy going shopping. In my free time, it’s hard not to scroll through Amazon or Instagram where I see products that I think I need or I just want. I also enjoy going to the mall or going to Target with my friends. Online, I have found that saving things to a list helps me not impulse buy them at that moment. I go back to the list after a few days and most times, the items don’t appeal to me anymore and I can delete them. When I am out shopping with friends, I have learned to ask myself if I really need the items I have in my cart, and if I do, I normally go look to see if something comparable is on sale. This has really helped me cut down on impulse purchases, and sale shopping has definitely saved me a lot of money.
Building credit is another essential aspect of being financially literate. Establishing good credit is helpful for future opportunities like renting an apartment, securing a job, or getting a car or home loan with lower interest rates. If you get a credit card, make sure you track how much you spend on it and pay the balance in full at the end of each month. Over time, this will build your credit score to ensure you are able to take crucial steps in building your life later on. To build my credit, I got a credit card attached to my parents account that I only use when I get gas. I pay them back when I fill up my tank, and they stay on top of paying the bill each month so my credit builds off of theirs too. The American Bankers Association is another helpful resource I found for tips about personal finance for college students.
Smaller things like budgeting and tracking your spending can be very helpful as well! Budgeting helps by providing a clear picture of your income and expenses, and this reduces financial stress and allows you to work toward your financial goals. I like to map out my budgets on paper so I can always look back on it and keep track of how I am doing as time goes on. Tracking every dollar spent ensures you stick to your budget and can help identify areas of spending you need to cut back on. This part is extremely hard for me, but it helps distinguish between “needs” and “wants.” That daily latte or late-night takeout may be a “want” that adds up significantly over time.
Being financially literate empowers you to make informed, effective decisions about your money, leading to greater financial security, less stress, and the ability to achieve your long-term life goals. Starting in college will help build a strong foundation for lifelong financial security by creating habits and patterns that will eventually become second nature. Being self-sufficient is a critical part of the transition into adulthood and is a skill that will serve you for the rest of your life.Â