Are you a Class of 2012 graduating senior on your way to college this fall? Or do you know a college student that could use some help with personal finance? Going away to college can be an eye opening experience for many students, especially when it comes to money management. But personal finance can be easy, even if you’re just starting out.
1. Sign up for a free checking and savings account. Be sure to shop around for a bank that caters to students. When looking at checking accounts, make sure you can access online banking, pay bills and manage your account without attached fees. And be sure to review all of the nickel and dime stuff banks may charge you for like too many ATM withdrawals, too many checks written, or a funds transfer. These charges can quickly get out of hand.
2. Once you have your checking account up and running, failure to keep track of your checking account can deplete your savings via overdraft fees. Whether you balance your checkbook using the traditional method, online or through one of the many available apps, track your spending. If you don’t know what in your checking account, your debit card can easily get you into the red. Don’t expect your debit card to be declined if your account has insufficient funds. Overdraft fees can be costly but are often times easily avoided.
3. Don’t sign up for a credit card unless you absolutely need one. If you do own a credit card, pay the bills on time. Credit card companies charge late fees. And late fees can be expensive. Some credit card companies charge as much as $50 per month. When choosing what to charge to your credit card, try to avoid non-academic debt. Your focus should be on developing good money skills with cash.
4. All college students need books. The question is should I buy new? Used? Or maybe even borrow a textbook if possible. If you can’t borrow, your next best option is to buy used college textbooks. There are many online bookstores that carry both used and new textbooks. Two of the more popular sites are www.half.com and www.textbooks.com to name a couple. Also, the campus bookstore does sell a supply of used books, but they are limited; so either get there early or check the online sources if you don’t want to pay for new books.
5. More and more of today’s college students are required to own a laptop computer. If you need to purchase a laptop for upcoming college classes, save money by shopping any of a number of back to school specials; discounts, rebates and some states even have a tax-free shopping week. Once you have decided on which laptop to purchase, decline the extended warranty offer. Your computer should be under manufacturer’s warranty for the first year anyway. Now that you own your laptop, don’t take risks with it by leaving it unattended or unsecured. Laptops and other electronics such as tablets, cameras and mp3 players can be made off with quickly in a dorm or library environment. Always keep your room locked and valuables securely stowed.
6. Living off campus? You will need to consider who you want for your TV, phone and internet hookups. With Allconnect.com you can compare costs at your new address for cable and satellite tv, high speed Internet, home phone service, gas and electricity. By comparing providers that are available at your address, you will be able to make decisions that best fit your budget.
7. Sounds basic but a strategy that is often overlooked by many college students is to spend less than you earn. Low on cash and your spending and income are roughly even? You have two choices: earn more or spend less. Summer and winter breaks often offer fantastic opportunities for a college student to earn some extra money for the upcoming semester. Every little bit counts.
8. Extra cash is often not a college student’s first concern. But, if you have some extra money that you can put away for later, learning to invest is a great idea. Finding a quality reputable discount broker is not difficult and they can offer you the opportunity to begin making small regular investments. Getting your feet wet in the investment arena should be your first concern. The most important thing is to develop a strong investment habit. You can worry about high returns and low fees later.
Lastly, be sure to make smart choices. You can spend your money on anything you want, but unfortunately you can’t spend it on everything you want.
Allconnect is a free online resource to review and compare the costs and choices for essential home services, including home utilities, high speed Internet, phone, cable TV, satellite TV, and home security systems.