Going to college means newfound freedom. It’s a time to pursue your passions, meet new friends, and grow—but the choices you make with your money while in college could have lasting effects on your financial future, for better or worse. Fortunately, making the right money moves in school can help set you on the right path.
As you embrace your newfound freedom and learn how to manage your finances while at school, follow these tips to stay on track.
1. Maintain a Budget
Gaining some financial independence from your parents is exciting as a first-year college student, but remember that little purchases add up fast. Given this, creating a budget early can work in your favor. Budgeting lets you track your earnings and significant expenses like food, gas, and transportation, as well as non-essential costs like dining out with friends.
You can start creating a budget anytime, and the best budgeting method is the one you can stick to. For instance, some might prefer maintaining a spreadsheet to track expenses, while others may appreciate a free and simple app like Goodbudget. Budgeting helps you understand your money and avoid costly mistakes.
2. Start Saving
During college, you might face an emergency or an unexpected cost. Putting some money into a savings account is one way to safeguard against these surprise situations. Your savings goals may differ. For instance, you might decide to build an emergency fund to use during school or simply work on setting aside money for after you graduate.
If your plan is to use those funds after graduation, your savings could help you repay student loans, relocate, or pursue graduate school. It may be difficult to save due to high living costs, but setting aside even small amounts now could be a big help in the future.
3. Monitor Scholarship Opportunities
There’s no denying that college tuition is expensive. Fortunately, new scholarship opportunities open up every semester. And unlike student loans, you don’t need to worry about paying back scholarship funds.
Research and apply for scholarships regularly to help pay for textbooks, living expenses, and other costs. Taking advantage of scholarships is a great way to graduate with less debt and more savings.
4. Apply For a Part-Time Job
Being a full-time student will take up much of your time. But if you need a more reliable or steady income, consider internships, campus or departmental jobs, tutoring, or part-time jobs off campus. Both on and off-campus jobs can give you the extra income you need to start saving or expand your budget as you move into college. On-campus jobs, in particular, can be great opportunities, as you’ll spend less on transportation and you can work around your class schedule.
Also, look into federal work-study programs if you qualify. These programs let you work part-time, helping to pay for essentials like food and transportation, or allowing you to set aside some money into savings. Some work-study opportunities even let you apply your earnings toward tuition to offset costs.
5. Start Building Credit
After graduation, good and stable credit will make it much easier to take out a loan or find an apartment. And the earlier you start building your credit, the better off you’ll be.
Unfortunately, one of the pitfalls college students often fall into is leaving school with credit card debt. Recent data from U.S. News & World Report shows that over 42% of college students have some level of credit card debt. Forty-six percent report that non-essential spending, including dining out, shopping, and impulse buys, has driven up their credit card balances.
A credit card can be a great tool to build credit, but be careful with your spending. Maintaining a low balance that you pay off on time and in full will help you establish good credit without garnering extra debt.
6. Understand Your Student Loans
Repaying your student loans may seem like a far-off task as a new college student. However, to ensure you handle your debt wisely, you must keep track of your student loans throughout your college career. According to the Education Data Initiative, 53.3% of undergraduates rely on federal student loans to pay for school. And 63% of borrowers reported financial hardship due to their student loan payments, according to an October 2024 survey by U.S News.
Student loans are challenging to repay, but preparing your finances early could make things easier in the future. Talk to financial aid offices, research potential repayment plans, stay up-to-date on when your loans will be due, and consider making small student loan payments while you’re in school.
Refinance Student Loans with ELFI
One way to prepare for your financial future is to understand repayment options on your student loans. If your estimated monthly payment appears to be high, refinancing your student loans could be an option down the line. Refinancing could help lower your monthly student loan payments, reduce interest rates, and shorten repayment terms. If you’re interested in learning more about the process, see how much you could save with ELFI student loan refinancing.
