Having an appropriate budgeting strategy while you are attending school is critical to getting the lifestyle you really want. Implementing the following budgeting strategies is the first step toward true financial independence.
- Identify your personal, professional and financial goals.
- Develop an affordable monthly budget and stick to it.
- Save a little money each month for emergencies.
- Keep accurate records of your spending.
- Maintain a strong credit history, starting with paying your bills on time, every time, including your student loan(s).
- Keep only one credit card and use it for emergencies only.
- Pay your credit card balance in full every month to avoid interest charges.
By establishing where you want to be financially, you can start to think about your short-term and long-term budget. Most importantly, we must deal with the short-term first, and to do that, the first step is distinguishing between the things that you want, and the things that you need.
- Food: groceries
- Shelter: roommates
- Transportation: public transportation
- Phone: regular land line
- Food: eating out
- Shelter: living alone
- Transportation: car
- Clothes: trendy/designer labels
- Phone: cell phone
In distinguishing between needs and wants, you can set up an appropriate budget that allots for the items you truly need. By maintaining a budget, each month you will find there is enough money to pay for your needs. You will not find yourself unable to pay for utilities because you purchased a new pair of shoes.
Additionally, by setting up a proper budget, you can start to put money away for emergencies and future indulgences. In this way, you can begin to think about your long-term financial future and plan ahead for the things you want. Gaining financial autonomy is an important part of becoming an adult. With a little work now, you can gain the ability to have more fun later.
A few more suggestions for relatively painless cutbacks to help curb spending and to help you stay on budget include:
- Make coffee at homeand fill a thermos to take to school/work.
- Use a grocery list when you shop, clip coupons when you shop, and buy bulk foods.
- Never shop when you are hungry.
- Combine errands to save on transportation costs.
- Bring your lunch to work with you most of the time.
- Leave your credit cards at home.
- Shop at consignment and thrift stores.
- Use public transportation.
- Cancel cell phone service or internet service.
- Lower the thermostat in the winter, and raise it in the summer.
- Share the living costs of rent and utilities with a roommate or two.
- Borrow books from the library rather than buying at the bookstore.
- Only eat out once per week, and learn to make inexpensive meals.
- Remember to factor in the cost of utilities into your budget, gas, water, electric, trash, laundry, etc.