As you go shopping for your new dorm room and pack for college, don’t forget to financially prepare. Much has been written about the high cost of college and the burden of student loan debt. However, going into college with a financially savvy attitude, clear goals, and a budget will help you avoid certain pitfalls. Keep reading to learn our best financial tips for college students!
Learn how to create a budget
Budgeting is a good financial habit and the foundation of your overall financial wellness. Establish a budget habit now, early on in your life, and it will serve you well (potentially keeping you out of trouble) as you move further into adulthood and make big financial decisions such as whether to buy a house.
Remember that the best budgets are flexible. As your life and income change, so should your budget. And don’t get frustrated if you’re off the mark the first month or two. Simply recalibrate your target categories based on your actual spending and keep going!
Here’s a round-up of budgeting apps and templates, all free since we know how important that is for broke college students.
Free Budgeting Apps
Try different ones until you find the best fit!
- Mint (free access to all features)
- PocketGuard (free version available)
- Zeta (specifically designed for couples)
- EveryDollar (free version available)
- Goodbudget (free version available)
- Honeydue (also for couples)
Free Budget Templates
Prefer to use pen and paper or a simple spreadsheet? Check out these resources:
- Make a Budget worksheet (The FTC)
- Budget Planner Worksheet (NerdWallet)
- College Monthly Budget (Microsoft)
- Monthly budget (Google Sheets)
Apply for scholarships and grants
You may already know that you need to fill out the FAFSA once a year to receive financial aid from your school. However, there are plenty of private scholarship opportunities out there. The more you apply for, the more chances you’ll have of winning tuition and book money. You can, and should, start applying for scholarships prior to your senior year of high school so that you have enough time to qualify. As a best practice, submit your application before the deadline, and do any work that might be required to support your application, such as writing essays, performing community service, etc. A little bit of work at this stage of your life can save you huge amounts of money later on by minimizing your student loan debt.
Websites For Finding Scholarships
These sites are all free and maintain scholarship databases as well as matching tools.
- Going Merry offers free personalized matching for thousands of scholarships and grants.
- Fastweb helps you find targeted scholarships as well as part-time jobs.
- Scholarships.com matches you with the millions of scholarships available.
- Big Future is a comprehensive website for searching colleges, planning for college, and finding scholarships.
- JLV College Counseling features “Scholarship Saturday” blog posts with a weekly roundup of scholarships and contests closing soon.
Research schools to determine cost
You may have a top choice school in mind, but be sure to review the costs first to determine what is a realistic choice for your budget. Check out College Scorecard, a website from the U.S. Department of Education, to compare the costs of different colleges.
One great way to save money on your college education is to attend community college first to knock out your initial credits for less money and no room and board charges. Our own Bucks County Community College offers an Honors@Bucks program with scholarship opportunities and a distinguished Honors@Bucks Associate Degree.
Have your heart set on the traditional campus experience? Consider a state school where you’ll pay a lower tuition rate as an in-state resident student. Browse the 14 universities in Pennsylvania’s State System of Higher Education. Additional public universities in PA include:
Understand how student loans work
If you plan to finance part of the cost of your education with student loans, it’s important to understand the options available to you, as well as how repayment will work. Here are the key points to consider:
Federal vs. Private Student Loans
With federal student loans, the U.S. Department of Education is your lender and various requirements apply. To finance your education with a federal student loan, you need to fill out the FAFSA and go through your school’s Financial Aid department. Learn more about federal student loans.
Private student loans come from other lenders, usually financial institutions. Your school may also show you options for private student loans. It’s important to compare the terms and interest rates on your student loan options, whether private or federal. Also pay attention to the repayment terms and understand that your loan balance may be higher when you graduate if you don’t make at least the interest payments on your loan while still in school. The exception to this is with Direct Subsidized Loans from the U.S. Department of Education, which pays the interest for you while you are at least a half-time student.
Start building your credit score
Once you turn 18 you can start building a good credit history and score. The best way to do this is to make on-time payments, whether for your utility bills, phone bill, and/or debt payments for loans or credit cards. If you open a credit card account in your name, it can help you build credit history if used responsibly. Don’t charge more than you can afford to pay back and make sure you pay your bill by the due date. The First offers four personal credit card options, including a Secured Card that could be good for a college student with little to no previous credit history.
For more tips on establishing a good credit score, check out our blog on “How Can I Improve My Credit Score?”
Create financial goals
Although the future may still seem distant, it’s good to start thinking about what kind of life you want to have after college. Whatever your goals, from travelling the world to retiring early, you can make certain financial decisions now to set yourself up to achieve those goals. For example, someone who wants to travel often could major in a field with ample remote/flexible work opportunities. Keep in mind that paying off student loans will be a major part of your financial goals for a long time to come, so factor those payments into your budgeting and future goals.
The First can support your financial goals in college and beyond!
The First has served the residents of Bucks County longer than any other local banking institution. Since 1864, The First has been a rock of stability for Bucks County – reinvesting in our local economy and families. We provide traditional banking services including checking, savings and loan products, as well as more sophisticated trust and wealth management services. Check out these additional financial literacy tips for young adults. Open a free student checking account today!