Post By: COYD Staff
According to the United College Marketing Service, 8.5% of students drop out of college due to money issues. To put that into perspective, only 6% drop out due to academic failure.* Personal finance is an extremely important topic that all students needs to research and prepare for before the first day of class. Below are 6 tips on how you can best manage your finances as you start your college career:
1. Use a debit card rather than a credit card.
On average, each student receives 25 to 50 credit card solicitations per semester.* This statistic shows you that college students are prime targets for credit card companies. As most of you know, a credit card makes money through fees and interest on the revolving loan if a credit card balance is not paid in full each month. Credit card companies know that college freshmen charge more than they can pay because for the majority of students, this is the first time they have the freedom to buy what they want, when they want it. This credit card debt basically begins their lives as debtors long before they begin their working lives.
The only time you should use a credit card is if you understand credit. The terms adjustable interest rates, transfer fees, late fees should be common knowledge for you if you decide to use a credit card.
In order to learn more about credit education, go to United College Marketing Services. According to the Chronicle of Higher Education, “UCMS is the best at selling credit cards to the college student market.” and the reason why is because they were the first to integrate credit education to the credit card sales process. Education is the key to making good choices.
If you haven’t educated yourself on credit cards, use debits cards. The only thing to be aware of is ATM fees. In order to avoid them, do not withdraw cash from ATMs that are not owned by your bank. You could end up paying as much as $6 per transaction.
2. Keep a record of your expenditures and create a budget.
The basic rule of wealth: spend less than you earn. For many of us, that is a hard task. Luckily, there are several free online personal finance websites out there that will help you manage your money. Below are a few:
3. Get a job.
Getting a job can help manage your finance in many ways besides the obvious one, making money. What it does even more is let you experience the effort is takes to make that money. So the next time you go to the movie theater and buy your ticket, popcorn and drink, you’ll know that that bill cost you 2 hours of work. In addition, getting a job takes up more of your free time, thus, giving you less opportunities to spend money.
4. Research checking accounts before opening them.
Make sure that your checking account doesn’t have any monthly fees. There are plenty of free checking accounts out there that don’t require minimum balances or minimum uses of your debit card to avoid monthly fees. Do your research and read the fine print before you sign up for any checking accounts.
5. Take advantage of student discounts.
There will never be a time like when you are a college student where you will be given so many discounts. From discounted movie tickets to software, every student should take advantage of them. Go to a previous posting titled Saving Money in College: Utilize student discount programs and rebate programs whenever possible for more information.
6. Be a bargain shopper.
Utilize the internet to find the best deals on any item you wish to purchase. Below are a few: