Four Personal Finance Tips for College Students

By Manisha Thakor, financial guru and co-author of the books “On My Own Two Feet: A Modern Girl’s Guide to Personal Finance” and “Get Financially Naked: How to Talk Money with Your Honey.”

Let’s face it, returning to school can be a stressful time. Here are four simple tips you can use to take control of your personal finances and have one less thing to worry about during the busy days to come.

1. Make a Monthly Budget

This message is simple, but it is one students often have the hardest time following: Don’t spend more than you make.

Create a monthly budget by listing out all your possible expenses for a month. If you anticipate going out to dinner with friends, add that into your budget as an expense and plan accordingly. The number you come up with should never exceed the funds you have available to spend.

It can be tempting to buy the new gadget or outfit you really want, even if you are not sure you can really afford it after a semester of late night pizza runs, but your life will be much less stressful if you budget and save for big purchases rather than guessing at what you can afford and buying on impulse.

Make a monthly budget and commit to stick to it.

2. Pay Debt Back ASAP
This tip goes along with making a monthly budget. Putting items you can’t actually afford on a credit card is a really, really bad idea. Use a credit card only for items you know you can pay off in full when the bill comes. Do not let a credit card balance build up. If you make just the minimum monthly payment on a “typical” credit card with an interest rate in the mid teens, you will actually end up paying nearly double the purchase price of whatever you bought by the time you add up all the interest. According to a 2009 survey by Sallie Mae, college students graduate with an average of $4,100 in credit card debt on top of student loans. Just say no to credit card debt.

If you are looking for a convenient way to pay your share of the rent or borrow money from your parents, try using a new service called ZashPay. All you need is the person’s e-mail address or phone number to send or receive money. You can access the service at

3. Bank and Pay Bills Online
By setting up an online banking account, you can view your balance, pay bills in minutes and keep track of where your money is going. Using online banking is simple and safe, and recent research from financial services provider Fiserv shows eighty percent of Gen Y already bank online, a higher percentage than any other generation. Some additional benefits to online banking include:
• Never lose a bill – You won’t have to rely on dorm mail or shared mailboxes; instead, sign up to have paperless bills delivered to your online banking account
• Maintain your credit score – 35% of a consumer’s credit score is based on the ability to make on-time payments. Online banking can give you the reminders to make sure you remember to pay on time and build up your credit score
• Save the Earth – If all US households received and paid electronic bills, we would preserve an estimated 18.5 million trees and eliminate the production of 2.1 million tons of greenhouse gasses
• For more information on online bill pay, visit

4. Avoid ATM Fees

Many students don’t realize just how much they are spending by using an ATM that is out of their bank’s network. In this scenario you typically get hit by two fees – one from your bank and one from the ATM owner. These charges may be “only” two or three dollars at a time, but going to an ATM out of your network even once a month can really start to add up. This is especially important to keep in mind when taking a weekend trip to follow your school’s football team or visit friends. While many banks are national, it’s not always easy to find an ATM in a new city. And it’s even tougher if you’re traveling internationally. Plan ahead so you can take out money from your bank’s ATM and avoid getting this extra charge. Doing so can save you hundreds in ATM fees a year.

You go to college to prepare for a profession and life-long career, but these four years are also meant to prepare you for the “real world.” And dealing with your own finances, keeping track of your expenses and income, is a part of the big picture. The key to a successful financial future is preparation and awareness. By putting these simple measures in place, you set yourself on the path to financial nirvana.