Looking for the best way to manage your money as a student? I know that being a student – especially a college student – is expensive and you will spend more of your money on school because of the project requirements. But despite this, you will need to learn about managing your money because this is a lifelong skill that you must possess to achieve financial freedom.
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Manage your money as a student
Having this skill is a gift, and not everyone knows how to do this. When you are in your college life, this is the best time to learn it because you will be introduced to adulting life and will be exposed to several expenses.
Budget your money
One of the most important things, if you are a college student, is to learn how to budget your money. This is analyzing your money in and out then creating a spending plan for your next expenses.
This is important to learn because, by budgeting, you will know how much you can save, and can help you to have financial stability. However, this is a skill that is hard to learn even though its concept is simple. This is because many people are starting to budget but did not commit to it.
When you started budgeting, you must keep in mind that it should be followed and you must stick to your plan so you can have the result that you are expecting. There are several ways to budget your money that you can implement in your budgeting plan.
- Zero-based budget
- Pay yourself first budget
- Envelope System Budget
- 50-30-20 rule
- The “no” budget
Learn the difference between needs and wants
I know that you are still in college and you have a lot of friends going to parties, eating in luxurious restaurants, and buying branded coffee daily. But have you asked yourself if these are your needs and wants?
As a student, you must learn the difference between your needs and wants. This is to avoid unnecessary purchases considering that you are in the adulting phase of your life. Most people ignore the fact that their wants are just luxurious and unnecessary, but this is why they are failing and did not achieve financial success.
Needs vs Wants
Needs are the basic things that you must have as a person such as food, shelter, clothes, etc. The main definition of this is you cannot live without this while wants is luxurious things, buying branded coffee, and going to the part every day.
However, even though wants is just a luxury, you must know that it is not always the case. You should also learn to treat yourself sometimes and when you deserve it. Just keep in mind that you must not abuse this because most people fail to do it and just keep saying “I deserve this” and ends up in impulsive buying.
Track your expenses
The best habit that you can do as a student is to track your expenses every time you purchased something. This is a life-changing habit that I have been doing since November 2022. When I started living far from our home, I decided to track my expenses daily and monitor them monthly. This helps me to create a monthly budget and spot my huge expenses so I can prevent them if it is unnecessary.
I have been using an app called Money Manager in tracking my expenses and this helped me to manage my money as a student. You can use this app to track your expenses from school, transportation, food, and a lot of categories that you can also customize.
In this app, you can track your income, expenses, and transfers. You can add any transaction even if it is your income or expenses then put it into the category that suits the most. For example, if you spent Php 100.00 on food, you can put it under your expenses and sort it into the Food category. You can also put the date and note on your transactions.
Also read: How I Manage My Finances as a Student
Pay yourself first
When you received your paycheck, start paying yourself first before spending it on anything. The concept of paying yourself first is to save or invest a portion of your money before buying anything. This is another type of budgeting that I find helpful in managing your money because you can easily save and invest with this method.
Furthermore, be mindful of dividing your money and make sure that you are saving enough while providing the money that you will need for certain expenses such as your rentals, bills, etc.
Take advantage of student discounts
Most students are ignoring this but you can save a lot of money when you are using student discounts. For example, while riding on public transportation, you can ask for student discount offers and use them to your advantage.
In transportation, you can mostly save up to 20% on service fees and it is a huge advantage for you if you want to save more money. You can also use student discounts and coupons for buying gadgets such as Macs and iPad.
The best thing that you can do while you are going to school is to know about financial literacy and you can start by learning how to manage your money as a student. This is what you will need not only in school but also during your whole life. You must be responsible for managing your money and learn to discipline yourself when it comes to spending.
Applying these things can make you feel confident in your financial status and can bring you financial freedom.
Aside from managing your money, try looking for ways to earn money even if it is a side hustle. For example, I use Hive to Write and Earn Money without spending anything!