How to Be Financially Secure as a College Student
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- Sticking to a budget and opening a savings account can help you stay financially secure.
- If you've lost your job, consider temporary alternatives like part-time work and unemployment benefits.
- Campus and government resources can help students get back on their feet and maintain stability.
No one wants to be a broke college student. Still, many hardworking adults find themselves in this exact situation.
Whether you are supported by your parents/guardians or are an adult learner with a family to care for, anyone can face financial struggles in college. Today especially, many find it difficult to afford skyrocketing tuition costs and don't have a big cash cushion available to help out in an emergency.
The good news is that resources are available to financially support students. In this post, we go over our top tips for maintaining financial security as a college student. We also introduce resources to help those facing financial challenges.
3 Basic Personal Finance Tips for College Students
Taking control of your finances is essential in college. Analyzing your spending habits can help you figure out what you need to pay for so that you can find ways to stay afloat. Here are some of the most important personal finance tips for students.
1. Create a Budget
Budgeting is key to saving and growing money in college.
First, you need to create a budget — this is simply a list of all your expenses and income. Second, you need to successfully live on that budget throughout each month. Many free or cheap apps can help you do this, such as Mint and You Need a Budget.
Daily spending decisions can add up over time, and small splurges can quickly translate into lost opportunities. This is why it's best to start budgeting as soon as possible.
2. Open a Savings Account
It's never too late to start saving. When you draft up your budget, include a line for tracking your savings. While you can save for specific things, like a vacation or a new car, make sure you're also contributing savings to an emergency fund. This will help you cover the unexpected expenses that can come up.
Setting aside small amounts — even just $5 a day — can help you get into the habit of saving money.
When considering potential savings accounts, the most important thing to look for is an account with zero or very minimal fees. Potential bank fees include service fees, ATM fees, overdraft fees, and insufficient funds fees. If you plan on keeping a significant amount of cash in your savings account, you'll also benefit from choosing a bank that pays a high interest rate.
3. Take a Personal Finance Class
Many young adults have little experience with personal finance and may find it challenging to make informed financial decisions.
This is where free finance courses come in. Offered through popular online platforms like Coursera and Udemy, these classes teach students critical life skills, such as how to save and budget, how to maintain good credit, and how to plan for your financial future.
Many colleges have even started to add personal finance classes to their lists of courses, in addition to free personal finance workshops throughout the year. Check with your financial aid office or course catalog to learn more.
How to Be Financially Secure If You Lost Your Job
Losing a job can be stressful, especially if you're working your way through college and rely on the money you make to pay for day-to-day necessities and your education. Fortunately, there are resources that can help stabilize your income as you search for a new full-time position.
Apply for Unemployment Benefits
If you've lost your job, you should immediately apply for unemployment benefits through your state. This money should be enough to cover basic day-to-day expenses and keep you afloat as you search for a new job.
Note that each state maintains its own requirements for unemployment benefits. In addition, it'll take around 2-3 weeks to receive your first check after you file for unemployment.
Get an On-Campus Job
Many students work on-campus jobs to help them pay for everyday expenses like room and board, food, and entertainment. These jobs are usually more flexible than regular part-time jobs, making it easier to work them in around your class schedule.
Examples include research assistant, front desk worker at the campus library or gym, tutor, and campus tour guide.
Consider a Side Hustle
As you apply for full-time positions, you might consider taking on a temporary part-time job or side hustle. Many jobs allow you to work remotely these days, making it easy to continue your studies as you job hunt.
You could transcribe audio files, write articles, or tutor language learners through a platform like italki.
The learning doesn't need to stop here
Explore the rest of our collection of financial education resources to continue your journey to a healthy financial future.Discover Now
What If You Have a Retirement or Investment Account?
If you're struggling financially, now's the time to check for any hidden or forgotten accounts you may have, such as a taxable brokerage account, a 529 plan, or a Roth IRA that your parent or guardian might have started for you. Keep in mind, though, that depending on how these accounts are titled, you may need your parent's or guardian's permission to access these funds.
Roth IRAs in particular are great options for college students to save money. That's because you can keep the money in this account to save for retirement tax-free, but if you ever need the money (such as during a financial emergency), you can withdraw your contributions without paying taxes and fees.
Note, however, that withdrawals on the earnings portion of your Roth IRA are both taxed and assessed a 10% penalty.
Retirement and investment accounts can be hard to understand. If you need assistance, you or your parents/guardians should call the investment company or an accountant to figure out how much you can safely withdraw — and how much you should leave in your account.
What Are Other Sources of Financial Assistance for Students?
Don't be afraid to get help if you're experiencing financial challenges. Students can access various resources to keep them financially secure and on track to meeting their academic goals.
If you need help finding a place to live, affording food, securing transportation, or managing other expenses, see whether your college offers any financial support or assistance programs for students. You can contact your school's financial aid office or student affairs office.
Local and State Resources
There are many resources at the local and state levels that are available to students facing financial barriers. While these may be broader and targeted more to the general public, they're still worth checking out.
Note that it may take some time to track down the financial resources that are most relevant to you.
Below are some places to start your search:
You can contact any company or person you owe a bill to, such as your landlord or bank, to let them know your financial situation and explore your options. For example, you may be able to get fees temporarily waived or start a payment plan.
DISCLAIMER: The information provided on this website does not, and is not intended to, constitute professional financial advice; instead, all information, content, and materials available on this site are for general informational purposes only. Readers of this website should contact a professional advisor before making decisions about financial issues.
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