10 money-saving tips for college students (who are probably already headed toward debt)
Recently, we posted a story that gave an overview of the student loan crisis in the United States (in case you didn’t see it, go read it!). Or just proceed from here, knowing that the main takeaway from our discussion was that college students ARE in debt… and by that I mean A LOT of debt (1.3 trillion dollars, to be exact).
So, if you or someone you know is one of the millions of high school seniors struggling to make final decisions about where you’ll go to college, how to pay for college, etc., etc., many of you could probably use some helpful tips and tricks to effectively financing your higher education. Between applying for scholarships, filing the FAFSA (I’ll explain…), and making all of the other necessary preparations for school in the Fall, this can be a really stressful time for prospective college students and their families.
Not to put a damper on the mood here, but it really doesn’t get easier even once you’re in college and think you have these questions taken care of. College students have TONS of living expenses; textbooks, school supplies, food, gas money, clothes, etc.–just to name a few. While most adult people might already understand how to manage these expenses, most college freshmen should expect, for the first time in their lives, to have to learn how to manage their money, and, ideally, how to manage it wisely.
So, what ARE some of the ways college students can cut back on spending and save some extra cash while in school?
I’m glad you asked!
First off, it’s a good idea to critically assess the amount of loans that you need to pay for school.
Your objective should be to take out as little of your total tuition cost in student loans as possible, and try to pay for the rest from your savings or with scholarships. This student debt calculator is a great tool for assessing how reasonable (or unreasonable) the monthly payments on your student loans will eventually be once you graduate. It also takes into account what you plan (or hope) to be making in your first post-college job.
File the FAFSA (or Free Application for Federal Student Aid) before the deadline–which is February 15th, by the way!
This is REALLY important, because FAFSA is what will make you eligible for scholarships and federal loans, which are a lot less scary than private loans. Why are federal loans less scary, you may be wondering? Well, first of all, they guarantee you a fixed interest rate, which means that the percentage interest that you will have to pay back, in addition to the amount of the loan, won’t change over time. In contrast, private lenders can raise or lower the interest rate of their loans at their own discretion (sometimes up to around 18%). Additionally, with federal loans, you can be sure that you won’t be required to start making repayments until at least 6 months after you graduate, or after you leave school for another reason. (For more information about the differences between federal and private loans, click here!)
Buy or (even better) RENT used textbooks instead of buying ones that are brand new.
This is a no brainer, right? And sometimes, you can even luck out by getting used textbooks that have really great notes already sitting there in the margins for your studying pleasure! Also, these savings are even greater if you sell the books back when the semester is over. If you’re not sure where to look for used textbooks, check out Chegg or Amazon! Both are great resources for finding reasonable prices on used books to rent or buy. It’s also possible that your university has designed Facebook groups specifically purposed for the exchanging, buying, and selling of textbooks among students. Definitely do your due diligence here, and find out where’s the best place to get a steal on this college necessity.
Search online for some extra scholarship money.
It’s pretty simple–if you can secure more scholarships, you may not need to take out so much in loans. You can always try FastWeb or other sites like it if you’re willing to do a little application writing in order to secure some of the many scholarships that are out there for the taking!
Form good money-saving habits.
Brew your own coffee instead of making that Starbucks run in the morning. Maybe you don’t need to splurge on that jacket you saw while you were out shopping last weekend? Do you even remember what it looks like, anyway? Pack your own lunch instead of stopping at a fast-food place in between classes. Learn some recipes for quick, easy meals that you can make for dinner during the week; you’ll be less inclined to order out, and end up saving a lot of money on tips for delivery.
Just remember: Impulse buys are the enemy. Keep your long-term goals in mind–smaller student loan payments!!
Public transportation is your friend.
Having a car on campus can be really convenient, but also really expensive for students to manage. Aside from gas money, many universities require students to purchase a parking pass each semester if they plan to park their car on campus. If you live near or on campus, walking or biking to class is a no-brainer that also allows you to circumvent transportation expenses. AND, it’s a great way to stay active during a busy week where you might not have time to go to the gym (this would definitely make the list for “How not to gain the ‘Freshman 15′”). If walking or biking is not an option, public transit is the way to go! No, it’s not free, and you’ll probably need to allot yourself more time to get to places than if you were driving there, or sometimes even biking, but it’s still cheaper than paying for your own gas, auto maintenance, insurance, and a parking pass. Some schools may even include the cost of public transit in your tuition, or have contracts with local public transit systems to allow their students to ride for free or at a reduced cost with their student ID, so be sure to look into that possibility.
Get a job.
This can definitely be a challenge with all of the work that you’ll have to do for class, but the best thing that you can do to save money is to make money. Working while you’re in college can also be a great way to learn time management skills and boost your resume. Future employers will be really impressed by a candidate who managed to maintain their grades and work their way through school. Also, who says you can’t work somewhere relevant to your future career? Although they’re not always paid, internships are a great way to gain work experience in the field you hope to enter after college and will make you a competitive applicant for future jobs. Many colleges have resources in their career offices to assist you in finding an internship, some of which might even be paid!
Assess what your cheapest living arrangement would be, and make it work.
Living in a dorm can be really convenient for students, and sometimes might actually be the best option for cutting costs on campus; but, don’t be afraid to consider the alternatives. First, check to see if your school requires you to live in the dorms during your first year. If they do, that makes your decision easy, and your payment flat–it’s also possible to have this cost included if you get a scholarship package. If your school does not require you to live in the dorms your first year, do some research on off-campus housing. Find some former and/or current students on Facebook, and ask them what an average off-campus housing payment looks like each month, what accommodations exist, what tips they can give you, etc. Divide the projected monthly expense for an apartment by how many roommates you’d be living with, and compare that to what you’d be paying to live in the dorms. (Keep in mind also, that the cost of utilities is often not included when you’re renting an apartment/house.)
Meal plan or groceries? Which is cheaper?
Often times, a college meal plan can end up being more expensive than simply saving the money and buying/cooking your own food throughout the semester. Foregoing the meal plan will also give you more autonomy over your decision-making when it comes to what you eat, how healthy your food is, and how much you need in order to get by. But, for many, this is also a question of convenience, since shopping for and preparing your own food can be very time-consuming and even more expensive if you don’t know what or how much to buy when you go to the store. Still, it may not be as difficult as it sounds. Pinterest can be a great way to find quick and easy recipes from all over the Internet, basically providing you your own grocery list for anytime you need to stock up. Account are free on the site, and once you sign up, you can “pin” recipes to “boards” that you create for easy reference. It’s basically like compiling your own recipe book! Give it a try.
Lastly (but definitely not least), make a budget and stick to it.
This may sound like common sense advice, but sticking to a budget is actually a lot more difficult than it sounds–especially for a college student. Unforeseen expenses can pop up at any time, so it’s important to be prepared to manage it. Actually sitting down and writing out a weekly or monthly budget will help you see roughly what you already spend, and help you assess for the future how much you’ll need in order to cover your expenses. It’s also great motivation to help you avoid making impulse buys (see # 5!). As time goes on, your budget might evolve, which is exactly what needs to happen as you work to monitor your spending habits while in school. If you’re looking for a cheat sheet to laying out your expenses, the internet is filled with them. Just Google what you need, or start here. And remember, it’s always a good idea to set aside some “contingency money”–just a little cash that you know you’ll have but haven’t allocated to any one of your expenses yet, just in case of emergencies and unforeseen events.