08.16.2010 / What College Students Need to Know About Finance

Below are five things that college students need to know about financial matters that often get left out of their pre-college preparation. Take a look, share with your family and most of all, and remember that financial education is as important as a college education!

1. Budgets Are Important – Even if you live on campus with your meals and board paid for, it is a good idea to track your other expenses and create a budget based on what you spend. Starting to track your spending now will help when you are responsible for all your expenses.
2. Save Every Month – A lot of people, especially students and new grads, think that if you only have a little bit to save (like five or ten dollars a month) it isn’t worth saving. Nothing could be further from the truth! Due to compounding interest over time, the five or ten dollars you might be able to save a month while in college can help set the stage for a nice nest egg later on.
3. Pay Your Bills on Time – This one is big, as it has the most repercussions later on. Paying your bills on time – or not – affects your credit score. Make sure that when you make your budget you anticipate any bills and pay them when they are due. This will keep your credit score healthy and will help you in the long run.
4. Don’t Max out your credit cards – College can be a great time to learn to use credit cards wisely. The biggest mistake new students make is maxing out their new credit cards. Treat your cards wisely – like an emergency fund – and you won’t be paying them off after you graduate.
5. Do your own taxes! – It might be tempting to let your parents do your taxes – but now is the time to learn how to do them yourself. If you have a job, start doing your own taxes as soon as possible – this will help set the stage for taking on more responsibility in your own finances moving forward!

Do you have any tips or advice to share? We’d love to hear from you.