(This is a guest article by XYZ*)
College is an exciting time of learning, meeting new people, visiting new places, and of course lots of the obligatory partying. Most new students do not think about the fact that it is also the beginning of your financial life. Indeed, now is the time when you cease being a dependent of mom and dad and become the master of your financial future. In order to make that future less stressful and more successful you have to start thinking about ways to get ahead financially and how to handle the little money that you have in the most effective way possible. While you might think you have too much on your mind to worry about your financial future it simply cannot be ignored. There are a few simple ideas that can go a long way toward building a successful financial life.
Financial Guide For College Students
Start saving and investing right now - College students usually do not have a lot of extra money in their budget, but that is not an excuse not to save. In fact, if you can learn to save 10% while you are earning very little it will be easier to save money as your income goes up. Take the money you save and put it in a high yield saving account or invest it in a Roth IRA. A Roth IRA is probably the best investment for college students because they are incredibly flexible. You can withdraw your initial investment with no penalty in an emergency or withdraw some of the earnings later on to buy a home.
Come up with a budget - You might think that as a young, single person you do not need a budget. But you are wrong, everyone needs a budget. Sit down and figure out all of your monthly fixed and variable expenses. Once you do that evaluate how you can bring some of those costs down. Maybe you should have a roommate to cut costs or eat out less. It is important for you to know where all of your money is going and exactly how much you have to spend. This helps you avoid spending too much and winding up broke at the end of the month.
Avoid overspending on credit cards - College is a great time to start building your credit file. You will have the opportunity to get excellent rates on credit cards so you should take advantage of them. However, owing a credit card is a big responsibility that has the potential to ruin you financially. Be sure you only spend what you can afford to pay back each month so that you do not have to spend money on interest. If you get to the point where your bill is more then you can afford each month then cut up your card or freeze it in a block of ice until the bill is paid in full.
Think of everyone you meet as a potential employer - One of the goals of college is to meet people who can help you get jobs later in life. As you meet new people treat them with respect and do your best to make a good impression. You never know who you will meet later on and what kind of opportunities they will have for you. There is no time like the present to start building a good reputation.
In the midst of all of this financial planning be sure to have fun while you are in college. Now is one of the few times in your life when you will not be burdened with lots of responsibilities so take the time to see the world and enjoy university life. Just make sure that at the same time you are making wise financial choices.
*About the author: This article was written by personal finance writer Timothy Ng from Sydney, Australia. He is genuinely passionate about helping people compare credit cards and helping them through researching to find the best credit card.
*Image Credit: Photograph by Proctor Archives [via Flickr Creative Commons]