Separate wants from needs.
With college expenses accumulating and newly discovered financial freedom, many college students find it difficult to adequately manage their money. According to the Consumer Finance Protection Bureau, there is roughly one trillion dollars in total outstanding student loan debt in the United States today. Unfortunately, students find balancing monthly loan payments and everyday expenses problematic. Dave Ramsey says that “personal finance is about 80 percent behavior. It is only about 20 percent head knowledge.” Creating a realistic weekly budget and consciously sticking to it is the most important thing a student should do. Next, a student should separate his or her needs from wants. With limited funds, it is important to prioritize spending. Furthermore, a student should open a checking account; it is critical to monitor and record all debit transactions. With new independence, many students approach credit-building in the wrong way. According to the International Journal of Business and Social Science, 70 percent of undergraduate students had at least one credit card in 2012. Students find it all too easy to amass enormous amounts of credit card debts. It is important for a student to learn the difference between credit-building and overspending. In conclusion, staying informed and getting into the habit of proactive spending is the most important thing a college student should do to start off financially healthy.
Madison Gaither, Montgomery Central HS