While college is generally considered a time of freedom and fun, the reality is that it’s also a crash course in adulthood, and you’ll have to watch your spending. Quite often you will be on a set budget or working part-time to help yourself financially. Even if your situation doesn’t create the same urgency in learning to be frugal, it’s still important to monitor your spending to increase your awareness of some spending habits you may never even have realized you had.
1. Track all your spending. Often we don’t pay attention to little expenses, but they tend to add up more than people would guess. That latte you had at Starbucks, your afternoon snack, or maybe you bought something simple like a notebook and forgot about it. While those expenses are not going to break the bank, they can create troubling inconsistencies in your ledger if they aren’t carefully logged. Keep track of how much you spend on little things and budget accordingly. If you go over your set monthly budget for minor expenses - ease up on those often unnecessary purchases.
2. Food. This one can be major in college. In high-school you may have enjoyed home-cooked meals and inexpensive food in the cafeteria. Now eating is a little more complicated, at a time when you’ve already been handed a lot of new things to think about. Many students succumb to the convenience of eating out for most of their meals. Restaurant food has one of the highest retail markups due to the laziness of contemporary society, yet rarely do you see young people cooking for themselves on a regular basis. You don’t have to become Jamie Oliver, but grabbing a fresh steak and some veggies from the local supermarket is an improvement on your fast-food diet and is actually minimizing your food expenses. Cooking can be therapeutic, even meditative, besides yielding a rewarding home-cooked dinner. Budget for groceries. There are a plethora of resources as well for students in dorm rooms who may not have access to appliances – its all about planning and prioritizing health and savings.
3. Night life and entertainment. While in college you’re expected to go out often, but it’s also not very reasonable to do so. Night clubs and bars, especially in the proximity of college campuses, are a black hole for your money. It’s nice to go out and have some fun, but budget accordingly. Initially having a single beer or cocktail a night may not sound like a great idea, but the difference to your bottom line will be significant. Chip in with some friends for drinks before you go out and just have fun clubbing, without buying anything more than the occasional drink. This gives you an opportunity to have a good time at college without sacrificing your financial goals. But only if you’re 21 of course!
There are of course other expenses but those tend to be the three big ones that make up the college student’s budget. Be smart, don’t enter the real world heavily in debt just because you didn’t spend a little time to plan your budget. Money management is by far the most valuable skill you’ll learn in college.