Oh, college. Filled with caffeinated nights, Saturday game days, and boxes of Easy Mac and ramen. While rolling out of bed in sweats to make it to class on time is important, making sure you squeeze in a night out with friends at least once a week is essential, too.
Every college student you know is probably broke. That’s the norm, right? The average student loan debt balance so far in 2019 is more than $29,8000 . While all your money seems to be going towards tuition, it’s essential to learn how to budget in college to make the most of what you have. Wouldn’t it be great to have a grasp on your beer budget? If you want to buy more than cans of soup for lunch, the all-important budget comes into play.
You may not have a full-time job yet, or even know your college major, but managing your money early on can help you avoid taking out additional student loans, save for spring break, and uncover monthly expenses.
If this is your first time taking financial ownership in your life, you might not know how to create a budget. Let’s break down ways to budget as a college student so you can afford to eat more than ramen this year.
Listing Out Your Expenses
There’s a little homework involved to learn how to make a budget in college, but it’s all about learning your spending habits. Take an evening to list out all of your college-related expenses. Don’t forget about things like athletic tickets or going out to eat.
Are you involved in Greek life? You might have sorority or fraternity dues that you need to pay for. If you have a car, you most likely have car-related expenses, like gas and oil changes.
Make sure you write down all expenses and estimate what they cost on a monthly basis.
Here are a few common expenses to consider:
• Car maintenance
• Greek life or other social organization dues
• Season athletic tickets
“For Sure” Expenses
Once you have a big list of expenditures going, divide out the expenses that you know for sure that you have to pay. These are essential expenses that if you did not pay, would make college life pretty difficult.
• Cell phone bill
• Food, and
These are all necessary expenses that you have to pay. They should take priority.
It’s college, so you want to make sure you have room for fun money, duh! List out all of your expenses that are related to fun and entertainment. These could include:
• Athletic tickets
• Spring break, or other vacations
A note on clothes. It’s not mandatory to buy every piece of spirit wear you find in the student union. You can keep it simple with your wardrobe. These are not mandatory expenses, but a pretty sweet addition to the college budget.
Estimating Your Expenses
You can make an estimate of how much you spend on each category if you aren’t totally sure. If you’re not sure, take a look back into your checking account statements or credit card statements and see what you’ve spent in past months. Your past spending habits are a good indicator of how you might spend money in the future.
Budgeting in College
If you need more help, there are three really good ways to help you budget in college:
• Budget-tracking apps
All three methods work similarly. You’ll record your income and expenses for each month. At the end of each month, you’ll look back on how much you brought in and how much you spent so you can make adjustments for the next month.
A whiteboard works particularly well if you have roommates and split your bills. It helps keep everyone accountable and serves as a good reminder to pay your bills on time. In the whiteboard scenario , you can record what you spent for the day, and update your totals every day. Put the whiteboard in a spot where you can see it, such as by your desk or on the fridge.
You can also use a budget-tracking app on your phone to take your budget on-the-go. Budget apps can link to your bank and credit card accounts, so every time you make a transaction, the app automatically records it. Keep in mind, apps require third-party authorization, so you need to make sure you’re okay sharing your bank account information with the app.
Set up your budget by adding new categories, and maybe allow notifications, so you get a warning when you’re close to going over on your burrito budget. Because burritos are life.
You can also learn how to make a budget in college with a simple spreadsheet. Use Google Sheets or Excel and build out a virtual spreadsheet. Use a new tab for each month in the year so you can separate monthly expenses.
This method is more manual than an app, but it might help you stay more connected by looking at your bank or credit card statements and manually recording each transaction in your budget.
Don’t Forget About These Expenses
When learning how to budget in college, don’t forget about building your savings. Double check if any student loans of yours have interest that needs to be repaid immediately. Even if interest payments are deferred, it’s a wise idea to start paying down on student loan debt now—every little bit helps.
Once you get a grasp on how to budget in college, you’ll see how you can make room for spaghetti nights versus microwave dinners. Plus, you’ll be more prepared to tackle your student loans when you graduate.
Centralizing your expenses, debt, and savings can give you healthy insights into your financial situation. SoFi Relay makes it easy to know where you stand with your money, when and how you spend – at no cost and all in one place. Plus, you can talk one-on-one with a financial planner at no cost to set ambitious goals for your money and your life, too.
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