
Your college years might be your first foray into financial independence. It’s going to be challenging, and you’re inevitably going to make some mistakes, but these five tips should make things a little easier for you:
1. Leave Wiggle Room in Your Budget
You know the best financial tool to have in your back pocket is a budget. If you’ve already made a monthly budget for yourself, then you’re on the right track. You just have to check to see whether you’ve forgotten one important thing: wiggle room. A budget without wiggle room is going to cause some major problems.
Why is that? When your budget is too tight, any small complication can dismantle it. If you make a miscalculation and you need to spend more than you originally assumed, you’re going to run out of funds. If there’s an emergency expense, you’re going to have to take funds meant for other budgeting categories to pay for it, or you’re going to have to find another way to handle it. It’s going to be unnecessarily stressful.
You can avoid this situation by adding a small buffer to your budget. The buffer is an amount of money that goes completely untouched until you need it for a miscalculation, emergency or other problem. That wiggle room will give you some financial security and ease of mind every single month.
2. Prepare for Emergencies
Having wiggle room in your budget is not the only way that you can prepare for stressful financial problems. You can do a lot more to protect yourself.
First, you can start putting a small portion of every paycheck into a savings account. Or, if you’d rather handle paper money, you could put bills into an envelope in a secure location. This will be the beginnings of your emergency fund. It will help you cover emergency expenses like car repairs, phone repairs and urgent dentist appointments without hurting your budget.
Building an emergency fund takes time, especially when your income isn’t very high. So, you’re going to want some extra protection. A personal line of credit is an effective safety net that you can rely on when unplanned, urgent expenses crop up. If you’re approved for a line of credit and your account is in good standing, you can withdraw funds within your set limit. Those funds will then get deposited into your bank account so that you can pay to recover from your emergency.
3. Don’t Abuse Your Credit
When you don’t have a lot of money to throw around, credit can seem like the ultimate solution. Anytime you don’t have enough in your wallet, you can just put it all on your card or make withdrawals from your line of credit, right?
It’s true that you can treat your credit like this, but it’s not the best idea. It’s a quick way to saddle yourself with a lot of debt that your current income cannot contend with. Credit is not extra money. It’s borrowed money. Not only do you have to give back what you borrowed, but you have to give it back with interest. And if you wait too long, that interest expands your debt and makes it even harder to pay off.
So, how can you treat your credit properly? Ideally, you should always treat credit transactions like loans that you need to repay as soon as possible. This attitude will stop you from spending beyond your means and racking up debts that you can’t manage.
4. Make Student Loans a Priority
If you’ve taken out student loans to help you pay for your college tuition, you should make repaying them a major priority. Don’t treat them like a responsibility for when you graduate. Start planning how you’ll repay them as soon as possible. This is especially important when you have loans with interest rates higher than 7%. Calculate your student loan interest rate to see what you’ll be paying every month and what you’ll have to do to keep your debt under control.
The government has paused federal student loan payments and frozen interest in an effort to give people some financial relief during the pandemic. This might be the perfect opportunity for you to save up and tackle those loans earlier than planned.

5. Find Money-Saving Alternatives
What does this mean? Instead of spending a fortune on brand-new textbooks, you can go to websites for college textbooks and get cheaper copies. Instead of pushing the limits of your budget every time that you go clothes shopping, look up tips for thrift shopping so that you can fill your closet with second-hand finds. And instead of signing onto expensive gym memberships and fitness classes, you can find free online classes and work out at home. There’s always a more affordable alternative.
Bad budgeting will only add to the stress of college life. By learning how to manage your money better, you’ll take that stress off your shoulders and make your college years a lot easier.