So before I post another fun-filled blog, I decided I needed to talk about budgeting. As a college student (or anyone really) it is important that you not only budget you money but understand your spending behavior as well. Establishing a monthly, weekly, or even daily budget early on in life will allow you to manage your money much better down the road. Plus, its kind of a challenge to see how much bang you can get for your buck! Here are some tips on setting up a budget.
1. Set up monthly and weekly budgets with some wiggle room. And by wiggle room I don’t mean “new purse” wiggle room, I’m thinking more along the lines of “the last bus left so I had to pay for a taxi” kind of wiggle room. For example let’s say you have $400/month to spend, which equals to $100/week. Instead of allotting yourself the entire $400 for the month, put away fifty or so. As many of you may know, expenses in college have a way of creeping up on you when you least need them, so leave yourself some emergency cash. Also, if you didn’t spend what you put away, don’t spend it the next month, perhaps put it in a savings account, CD or invest it. Or if you are feeling oh so generous, donate it to a worthwhile cause.
2. Track your spending for 1 month. This may seem tedious, but it is necessary if you are going to budget effectively. You can use a checkbook, online banking, or simply a pen and a pad, but you must ensure that no expense goes unaccounted for. When the month is over, write a list of your biggest expenses: Rent, Utilities, Food, transportation etc. From that list break your budget down into categories starting with monthly expenses: $800 for rent, $100 for utilities etc. Then onto weekly expenses: $50 for food, $30 for weekend activities, $20 for transportation. Sometimes this may change from month to month for example: you don’t need as big of a book budget in November as opposed to September, or you’ll be at home for half the month of December so your food budget may shrink (don’t forget those Christmas presents though!). However, your budget shouldn’t vary too much. You want to get into the habit of only spending a certain amount on certain items.
3. Always make sure you are checking your account balances. Keeping a close eye on your finances will not only keep your spending in check, but will help you spot credit card fraud quickly.
4. Know when to say no. Before you buy something new, take a few seconds to reflect on if you really need that item, if you have something that will do, and in some cases, do you actually already have it? If you can say yes to any of these questions, put it down and walk away. I also like to follow the two week rule. If I am still thinking about something two weeks after I last considered purchasing it, I’ll consider buying it if it fits my budget.
5. Get creative! Want to go out for dinner and drinks on Friday? Find other cheap/free activities to do the rest of the week. Need to save money on food? Look for meetings, talks, hall programs and get-togethers around campus, they often have food for free, and who knows? You may discover a new passion! Want new accessories? Have an accessory swap with your friends. Everyone can participate regardless of size and you might find the perfect necklace to glam-up an old top.
If you have any more tips, feel free to leave them in the comments!