What College Freshman Should Know

By Kaitlin Hurtado on November 10, 2023

This article is brought to you by GradGuard. We protect college students and their families from the financial risks of college life, like providing a refund for tuition or replacing a stolen backpack when your school may not. When the unexpected happens, GradGuard’s tuition insurance and renters insurance can help you get back on track.

Your freshman year of college will lead you to experience plenty of new things, from managing your own schedule for the first time to moving out on your own. One new experience many college students may underestimate is finances. If you are looking to start your college journey, or are already on it, keep reading for what college freshmen should know about money.

Photo: Pexels

Create a budget 

Before college, you likely did not have experience making a budget. In college, however, creating and sticking to a budget can do wonders to keeping your college experience running smoothly. In the simplest of terms, you should be aware of the money coming into your life, and out of it — track your income and expenses. Income can come in the form of student loans and financial aid, wages from part-time work, money from family, and so on. Your expenses should include anything from tuition and rent to weekly groceries and money spent on social outings.

Recognizing your income and expenses will allow you to see what you can afford to spend, or what you can’t afford to spend. If you find your expenses adding up with not enough income to cover them, consider how you can increase your income (picking up a job) or cut back on your expenses.

Be smart about credit

Depending on your financial situation before college, you may be getting your very first credit card. As a college student, there are plenty of credit cards designed specifically for students who have limited financial experience. These can include a variety of cash-back offers, sign-up bonuses, referral bonuses, lower interest, and minimal/lower eligibility requirements as younger students likely don’t have reputable credit of their own yet.

If you are signing up for a credit card, be smart about your usage. Don’t just start swiping away with reckless abandon. Be aware that you are going to have to make timely payments to chip away at accrued spending. A good habit to keep in mind is only to spend as much as you can afford to pay away that same month, or as soon as payday rolls around.

As intimidating as credit cards may be, having one during college will help you in the long run if you are using it wisely. As you make timely payments and use your credit card, you can help build your credit to receive higher credit limits and help your future purchases, which may include a car or home.

Take advantage of discounts

If you look hard enough, there are deals and discounts available for a majority of the things you buy and services you pay for. As a college student, there are even more opportunities for a good deal as long as you have access to your student ID or your school email.

Think of the streaming services you pay for, from Spotify and Apple Music to Hulu. Look for discounts that you can use as a college student, from a discounted subscription cost to service bundles to help you save.

Online retailers and other businesses also offer exclusive discounts and deals to college students, so don’t be afraid to look when you are looking to purchase.

Expect (and save) for the unexpected

College, just like any period of time in your life, can come with plenty of changes that are unexpected. Your life circumstances can change at the drop of the hat and unfortunately, this can have a large (and often negative) to your current financial situation. Never feel too comfortable with your current financial situation – be sure to save and plan in the event that you will face some unexpected changes.

This can mean a sudden loss of income — you can lose your financial aid, get fired from your part-time job, or receive fewer hours (and less income) than you usually do. Or, something can happen that will introduce a larger cost that isn’t typical due to your budget — car repairs, a vet bill for your pet, some medical expenses, and so on.

While you cannot predict the future, you definitely can do things to save up for a rainy day. This can mean cutting back on your spending in order to afford to put more into your savings without changing your current income. Or, you can pick up another job during school breaks to save up for when you are not able to work as much. Similarly, if your schedule doesn’t allow for a regular part-time job, consider gig work like babysitting to get some income when you have the time.

Navigating finances at the beginning of your college journey can be a daunting task, but with proper research, you can help yourself stay on top of your financial situation and minimize the amount of stress finances cause many college students. Good luck!

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