Your college student is away from home and managing his or her own money for the first time. A study by The Ohio State University in 2015 found that 70 percent of college students are stressed out by their finances. Here are 6 more tips on how to help them manage their money (and reduce stress at the same time):
A part time job earns some cash, but it also helps your student to manage their time better. Studies show that students with part-time jobs actually get better grades than their more indolent colleagues because they use their time wisely. An on-campus job is most convenient. And once summer rolls around, a “full-time” summer job is essential.
There’s a reason why franchises like Plato’s Closet® abound in college towns, where they buy gently used designer garb for resale. Most college students have too many clothes, not too few. Figure any necessary apparel purchases by your student into the monthly allowance and go from there.
Food & Snacks
We all know how food costs rack up. When living off-campus, the cost of rations can be lowered significantly with a little forethought and planning:
- Encourage them to pack a lunch rather than buying a lunch. If they can’t do that every day (and who amongst us has the discipline?), then try Monday, Wednesdays and Fridays. Or Tuesdays and Thursdays. Or chose one day. Just don’t lunch eat out every day.
- The campus cafeteria is generally less expensive than a meal plan.
- Carry their water bottle wherever they go. Refill it often.
- Encourage them to consider those “options” at the coffee shop: regular-sized specialty drinks, tempting but horribly overpriced muffins, the larger size of specialty drinks, other snacks at the cash register. If they have to go into the coffee shop for that group study project, stick with a simple drip coffee.
No one ever died of boredom at college. Many colleges offer a bunch of activities that are low cost or even free – movies, trips, shows, lectures by visiting speakers, etc. Encourage them to get some friends together and take advantage of the free stuff. It’s who’s there that’s important, not what you do.
No one is suggesting that cell phones are optional expenses, but there are ways to tame the monthly cell phone bill dragon. Consider discussing the following with your student:
- Switching to a contract-free plan: the additional upfront cost of buying a new phone will usually be more than offset by lower bills over the following two years
- And once they’re contract-free, keep that phone longer than two years. They may not be the envy of their friends with the latest iPhone, but lower costs more than compensate. They should remember that the latest models don’t have such big jumps in technological advances as a few years ago.
- Free WiFi is everywhere. Use it! WiFi saves data usage, as well as allowing free video calls on services such as WhatsApp and FaceTime.
And while we’re talking tech, encourage your student to minimize – or eliminate - those extortionate monthly TV subscriptions. Go outside instead – see below.
Saving money by going outside? What! Yes, it’s true. Encourage your student to get into the natural light, breath the fresh air, and listen to the birds. Think walking, hiking, fishing, or just hanging out - outside. Not only are they reducing their carbon footprint by not consuming electricity, but they will feel great, it’s more fun, and it doesn’t cost a cent.
Managing their own money for the first time can be daunting. Give your student some gentle guidance, and some practical money-saving tips, and watch them flourish.