Let’s face it, growing up is difficult. Stepping out of your family home and becoming independent has its perks, but it brings challenges. Too often, we feel completely lost and clueless in the face of adult problems like paying our bills, fees, rent, and buying groceries. As a college student, you may not be entirely independent as some expenses are covered either through funding or by your parents; in some cases, you still need to manage your finances to foot your living expenses.
Some students think it is too early for them to become financially independent while studying; however, the earlier you start, the less financial problems you will face in the future. Your saving habits can help you throughout your life. If you are a student who is struggling to become financially independent but doesn’t know where to start, following a few tips will help you manage your finances as you step into this phase of your life:
Your Own Bank Account
One of the first steps in becoming financially independent is to open your own personal bank account. If you have a joint account with your parents, now it is the time to get an independent bank account to manage your own finances.
Here the benefits of having your personal bank account:
- An independent bank account can help you analyze your expenses better
- You can maintain a credit score of your own and get associated benefits
- It can help you organize your spending habits
Get a Job
It is useful to find yourself a source of income whilst studying. You can search for freelance work online where you can take projects relevant to your skillset or interests. Or, you can look for a job that is relevant to your degree as it can provide you invaluable experience. Once you complete your degree, you can get yourself a decent full time job based on your experience. Several colleges also offer opportunities for students to work and earn during their studies, such as a research associate, teacher’s assistant, library assistant, etc. Actively look for such opportunities and avail them while not letting that affect your studies.
Here is what you should keep in mind when getting a job during college:
- Look for a job that has flexible working hours
- If you have a particular skill set, make it a source of income
- Utilize semester breaks to get a summer job or internship
While thinking of becoming financially independent, you must learn the skill of budgeting. Plan your expenses in advance and write them down to analyze your spending. It is easy to be tempted to spend money on a weekend party, but learning how to spend the money wisely can help you in the long run and help you save as well. Track your spending habits and learn to prioritize.
Here are a few notable benefits of budgeting:
- Budgeting can help you keep a track
- Through a set budget, you are most likely to save money
- Sticking to a budget can help you develop a sense of control
- Budgeting can help you cut on unnecessary items
Use Your Credit Card Wisely
What do you get when you combine banks with digital marketing? I think we have all received exciting credit card offers that tempt you to purchase things you may not even need.
For students, this is especially problematic; once you get in the habit of making extravagant purchases on your credit card, there is a chance that you will end up paying hundreds back in premiums every month. There is nothing wrong with shopping and rewarding oneself once in a while but keep in mind: The money that you are using now is technically not yours, and you will have to return it to the bank with interest one day.
The offers may look amazing right now, but they could also become a nightmare when the credit card bill arrives. Tempting offers, discount coupons, and multiple other marketing gimmicks may lure you into spending. Try to not fall for those offers and focus on spending your money wisely.
Residence and Commute
Where you live affects your budget; if you live on-campus, you save a lot on travel expenses and rent. However, getting a room in college dorms is often tricky as there are limited spaces and a lot of students applying for them. On the other hand, you might have to share your room, and some students may prefer a room of their own.
If you are living off-campus, make sure that it’s not too far, or you will have to spend a lot of money on fuel or train tickets. Figure out your means of transportation as it can cost you a lot if you do not plan ahead. If you have a car of your own, then you must consider the expenses, including gas, maintenance, and insurance.
Other options of commute include using subways, carpooling, or cycling, which are budget-friendly choices that you can avail to save money.
Other Useful Tips to become financially independent:
- Compromise on your lifestyle for a bit, you can enjoy the results later. Being a student does not have to be luxurious to have a great college experience!
- Living on a budget is nothing to be ashamed of; finding cheaper alternatives for food and other necessities can help you save a lot of money.
- Develop a habit of saving; for example you could put away a small amount at the beginning of each month. Looking into that money box at the end of the year and seeing a large lump sum will be a great feeling!
Becoming financially independent helps improve self-esteem and gives you a sense of fulfillment. Remember, it is not bad to seek help from your family, but it is better to manage your expenses yourself. Becoming financially independent does not mean you have to cut all monetary ties with your family immediately. It is an incremental process where you have to slowly plan your moves and find a way to earn enough to support yourself and eventually improve your lifestyle. However, focusing on wise spending habits is essential and will determine the kind of life you will lead.
Arslan Hassan is an electrical engineer with a passion for writing, designing, and anything tech-related. His educational background in the technical field has given him the edge to write on many topics. He occasionally writes blog articles for Dynamologic Solutions, A software house in Pakistan (https://www.dynamologic.com/software-house-in-pakistan/)