Category Archives: Money matters

Budgeting Tips for College Students

Almost every person I know worries about their financial situation one way or another. And in the wake of the Covid-19 pandemic, it is no surprise that many people, especially the younger crowd, are feeling a heavy weight on their shoulders financially.

My kids are out of college now, but they worry about not having enough knowledge about budgeting. Here are some suggestions that have helped them tremendously. These might be helpful also to some struggling college students (or anyone) out there who needs them.

Keeping a budget as a College Student

People who are good at handling their finances work on an in-depth budget for the next month. Budgeting does not mean restricting spending but predicting your expenses at any given time. Keeping an acceptable budget is one of the most important things you can do.

Creating a budget is a balancing act for sure. There is a learning curve and external factors that influence how you budget. But once you get the hang of it, you’re all set. When you make a budget plan, plan for the worst, and hope for the best. You can even do it on a spreadsheet if you are feeling fancy.

There are a lot of productive ways that one can do to save money. These are some of them:

Listen to Finance Podcasts

Another way to improve your financial literacy is by listening to podcasts about finance. You can learn so many things about budgeting and other topics about financial matters through a podcast. You can listen while doing household chores and errands. It’s a great way to soak as much info while doing other things.

S.M.A.R.T Goals

You have probably heard of SMART goals, which stand for Specific, Measurable, Achievable, Relevant, and Time-Based.

  • Specific – It’s a good idea to set goals categorically. Set a limit for how much you can or should spend on each category. When you do this, you are making your budgeting a little more manageable and minimizing the risk of overspending. 
  • Measurable – You can make a system to determine whether you have succeeded or failed in your monthly goal. It should be easy since you are already keeping track of money. If you spend half or less than half of your monthly budget on dining out, it’s a success.
  • Achievable – Make sure your goals are attainable for yourself. It’s okay to take baby steps. By doing it little by little, you’re making it more of a habit, which will set you up for long-term success.
  • Reasonable – Make sure that the money you’re earning is proportional to how much you are spending. Financial independence is a big part of every young adult’s life, but be sure you’re not falling into the lifestyle creep.
  • Time-Based – Deadlines are super important, especially for short-term goals. Make sure you stick to them. Additionally, you can set long-term goals by spacing them out monthly.

Budgeting Apps

If you are using a smartphone, you can download a budgeting app to your phone. Not only does it help make things more organized, but they’re also almost always free.

Photo by Sharon McCutcheon on Unsplash

The Envelope Method

I picked up this method a couple of years ago, and it has been a lifesaver. The envelope method is helpful when you are having a hard time budgeting. It means that you have an envelope filled with a budgeted amount of cash for every need that you might have, be it food, clothing, or other necessities. Everything that you spend money on must come from the envelope only. If you haven’t used all the money, you can add it to your next monthly budget. Keep your priorities in check the next time you want to spend money on something you probably don’t need.

Dealing with Bad Credit

Anyone can have a bad credit score, regardless of age. However, it seems that young people today have bad credit scores. A poor credit score does hurt your chances of applying for things like credit cards, loans, or even renting your place. You can still get a loan despite poor scores, but it may take a while to find a place that can offer you a loan with your situation.

Luckily, creditloan.com offers bad credit loans for people with poor credit scores. What exactly are bad credit loans, you might ask? It is a personal loan that you can take if you ever have poor credit scores. 

Money Management Tips to Improve Your Finances

Managing the family budget is no mean feat if you rely on a single source of income. By learning and developing a thing or two about better money management, budgeting is less stressful. These simple money management habits will help you appreciate every centavo that you earn regularly.

There are three things to remember if you want to make the most of your hard-earned money. Moreover, this works whether you are planning for yourself or your family.

Photo by Karolina Grabowska from Pexels

Create a Budget

It is easier to plan your finances if you know how much you have in your budget. A well-thought-out budget will help you track your expenses and savings. 

List the amount of money you expect for the month minus the tax – be it coming from your regular job or sideline jobs. 

Take note of all of your spending. These include household bills, mortgages, credit cards, personal loans, groceries, personal effects, and other items. Be sure to pay your bills on time to avoid paying penalties. Paying up late fees would bust your budget list. Failing to pay your credit card would incur a higher interest rate and might damage your credit score. 

Collect the receipts if you must to get the exact amount for each expense. From here, you can be more specific in areas that need allocation adjustments. 

Photo by Damir Spanic on Unsplash

Saving Goals

Once you identified your spending list, set aside a portion from your take-home pay. 

A budget rule called the 50-30-20  is a simple guide to help people reach their financial goals. 

Allocate 50 percent of your take-home pay to spend on your basic needs and paying your obligations. Allot 30 percent to your wants like shopping or traveling, and 20 percent for emergencies and retirement.  

While unexpected expenses happen beyond our control, the 50-30-20 rule will help you manage your hard-earned money, so you have funds on hand for emergencies.  

You can adopt this budget management rule if it suits you or create a plan that fits your need and lifestyle.

Photo by Avery Evans on Unsplash

Tackle Your Debts 

It is hard to achieve your financial goal if you are heavy with debts. It may seem difficult to pay off a loan diligently, but it’s the only way to control your finances. 

Pay on time. Never miss a payment. If you are dealing with multiple loans, pay the ones with the highest interest rates. You can also try paying the smallest loan to the biggest. Whichever strategy you apply, the important thing is you avoid paying compound interest.  

Reassess your budget plan after settling your debts. Check on areas where you overspend. Adjust your habits if necessary such as, dining out, watching a movie, or shop an expensive gadget.

Avoid owning several credit cards. Whenever possible, use cash in your transactions. 

Conclusion 

Knowing your financial situation and having a direct hand in managing your own money will guide your spending habit. Your budget plan will show you how much money you have after paying your monthly bills and show you how much you can allocate for your savings.

Lastly, find more passive income ideas to improve your financial status. You can start by creating a blog or a Youtube channel, creating an app, or sell information products.