How do you manage your money in college? This is the question that lurks in the back of my mind as I periodically check my bank account balance and log in my budget how much I spend a month. For many of us, it’s our first time being wise about our own money and not relying on our parents’ credit cards. While true financial independence will take a while to achieve, here are some small steps to build it up.
Budget, budget, budget. We’re all going to have to spend something per week, so figure how much you want to put towards eating out, shopping, buying gifts, clothes, stationary, etc. Ask yourself if you really need that newest shiniest thing right now. On the other hand, don’t be too stingy! Treat yourself to a little sweet at the end of a busy week, or buy that gift for your friend. Just make sure you balance it out with some prudence.
Invest. You’re never too early to start investing. There are plenty of financial literacy tools online and classes at Tufts to help you make your first foray into investing. As you’re a college student, start with something low risk and easy. I recommend opening up guided investing accounts if your bank offers them, where your bank invests for you, or if you want to try it on your own, start with $500-$1000 and invest into ETFs or index funds. You might lose some or gain some, but in the end, you’re preparing yourself for a more volatile market ahead.
Choose your credit card(s) wisely. Many companies offer you some sweet deals when you apply, because you’re only starting to build your credit history. Maybe you’ll get cash back deals or there’s no APR for the first year when you pay off your bill. Know what you are looking for in a credit card though, and don’t overspend! Once your APR kicks in, it will eat into your bank account.
Learn about how to file your taxes. It’s pretty simple now as a student, because (most of you) aren’t making a lot, and your income streams are more limited, but once you go into the workforce, it’s going to be harder to fill out forms relating to your income, side hustles, donations, investments, etc. Although it’s tedious, taking 5 minutes to read about it now will save you much pain.
If you’re feeling like you could boost your balance a little, consider getting an on-campus job or working off campus! Many students do work-study on Tufts, but others work as baristas or waiters in restaurants in Davis Square or on Boston Ave., and some, especially pre-med students, go into Boston to do research or work in the healthcare field. For me, I spend a good chunk of my weeks spinning yarns of my life as a Tufts student for all of you wonderful prospective students.
Don’t expect yourself to pick up all the financial knowledge you’ll need right away - it’s a lifelong journey! But starting now, you’ll be able to enjoy a smoother ride into being able to choose the life that you want further down the road.