By: Charlestien Harris
It’s that time of year when college-bound students will be transitioning from a familiar place to a college campus – whether far away or perhaps not very far from home. Regardless of the distance, your finances during college should be a top priority. Through my years of delving into the topic of financial literacy, I’ve come to realize that grasping basic financial skills and concepts is crucial for a successful financial future. Nearly all our adult actions, such as earning money, budgeting, paying off debt, and saving, heavily rely on our personal financial literacy skills. I acknowledge that some young individuals lack the necessary financial guidance to manage their finances independently, and college marks their first step toward financial responsibility. Thus, I’d like to propose some straightforward money moves that can assist college students in navigating this newfound financial freedom.
In many cases, young college students must mature quickly, and a common aspiration among them is to achieve independence from their parents. However, the challenges of independent living often differ significantly from their expectations. Here are a few money moves that can at least set you on the right path toward becoming financially savvy.
Money Move #1: First and foremost, strive to become financially literate. This entails learning as much as possible about personal finance. Acquiring personal finance skills helps you comprehend your earnings, monthly expenses, and aids in budgeting within your income or monthly allowance. Several college campuses offer basic personal finance courses, and some even house on-site student financial education departments within their financial aid offices. Colleges are rapidly recognizing that personal finance education is integral to their students’ success and is also linked to the student loan debt crisis that numerous campuses are currently grappling with.
Money Move #2: Secondly, master the art of tracking your spending habits. The simplest method to stay in control of your finances is to monitor where your money is being spent. Regularly assess your expenditures to identify areas where you can cut back or spend more efficiently. While monthly tracking provides a more accurate overview of your regular spending patterns, you can also do this daily or weekly. Examining your monthly expenses and comparing them to your income might reveal how much those small, daily purchases accumulate. Armed with this insight, you can identify where adjustments are needed.
Money Move #3: The third step is to establish a college budget. A budget is a potent tool in personal finance. Crafting a budget helps you plan your expenses for the month and enables you to anticipate any remaining income, if applicable. Abiding by a budget doesn’t signify a lack of enjoyment; it merely ensures that your enjoyment won’t jeopardize your bill payments.
Money Move #4: Consider opening a savings account. Consistent saving is one of the most challenging budgeting habits to maintain, as it demands discipline and prioritizing future goals over present desires. Nevertheless, successful saving lays the groundwork for a strong financial foundation when you graduate and enter the workforce.
Money Move #5: The fifth money move involves setting both short-term and long-term financial goals. This is crucial, as goals provide something to strive for and keep you motivated on your journey. Achieving a short-term goal can make attaining a long-term goal appear much more attainable. Budgeting and saving are skills that require time and practice to master, and your college years offer the perfect opportunity to make minor errors without grave consequences. If you find yourself occasionally overspending or making mistakes, that’s alright. You can recalibrate to get back on track. Your focus should remain on cultivating healthy financial habits that will serve you for years to come.
Many college campuses are instituting financial literacy programs tailored to students. A significant number of these programs originated from personal finance departments on these campuses and boast adept staff members and well-trained interns. Typically situated within financial aid offices, or sometimes having their own dedicated spaces, they extend a variety of services to current and former students, ranging from student loan debt counseling to budget establishment. If you’re a high school senior or about to commence your college journey in the upcoming fall or spring, I strongly urge you to visit your campus’s financial aid office to ascertain the existence of a student financial education program. If such a program exists, I encourage you to take full advantage of the services provided. You won’t regret it; it could be one of the most pivotal decisions shaping your financial future.
Until next week – stay financially fit!
Charlestien Harris is a financial contributor to DeSoto County News. She is a financial expert with Southern Bancorp Community Partners whose articles are seen in a number of publications around the region. You’ll be seeing her columns weekly on the DeSoto County News website and our social media channels.