College is an exciting time in a young person's life. It is the first time that many folks are learning to become independent. Along with the experience of making new friends, trying out majors, and exploring career paths, however, come the challenges of learning to manage one's personal finances. Here are seven money tips that will help a college student.
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1.Set up a budget. No matter where your source of income comes from (scholarships, loans, grants, parental assistance, etc.), know how much money you have coming in and how much money you expect to spend every month. This is especially important for students who get a semester's worth of loans at the beginning of the term -- don't spend it all only to be broke with a month left before the next disbursement.
2. Know how much you owe and the interest rates on those loans. Some college students have subsidized loans (where the interest starts accruing after graduation), some have unsubsidized loans (where the interest starts accruing immediately), and most have both types. This About guide has a list of the most common types of student loans.
3. Build your credit history. According to Brandon Farestad-Rittel, a writer for Kinoli Inc, students can build their history with a store credit cards (but watch out for those high interest rates!) and paying them on time. Students with willing parents or guardians may also get a credit card with a cosigner.
4. Find part-time or student employment. A job helps students start building an employment history and may lead them to internships and full-time work. Working also provide students with money for necessities and even some small luxuries.
5. Learn to cook. Students don't need to become master chefs, but learning how to make some simple and delicious meals will both save money and waistlines. A few dishes that are my old-standbys are: scrambled eggs and omelets, ramen soup, turkey sandwiches, and when all else fails, frozen pizza. Check out Passive Family Income for 4 easy recipes.
6. Live with roommates. At many schools, students will move out of dorms after their first or second year. It might be tempting to get a studio or one-bedroom apartment, but the math almost always work in favor of those who live with one (or two, or three) roommates. Aside from the lower rent, the utility bills will also be shared.
7. Drive a cheap car (or better yet, get by with no car). Cars, with the attending monthly payments, gas, repairs, and insurance, can be a big money drain on a small student budget. If a student can get by without a car, all these costs go away. If a car is necessary, however, then a reliable second-hand model is the best option.
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