Proactively Planning Your Finances While Still in School

A student writes a check

Thinking about your personal finances can be overwhelming. Being fully present at college can make it even harder to plan for the future. If you’re not already planning your finances, they may sneak up on you post-graduation (student loan debt, looking for a home, and more).

To help avoid that strain on your future, however, here are some ways you can work to get your finances on track while still in school and ensure a brighter financial future.

Apply for Financial Aid

We all know college is expensive. But that doesn’t mean you should write off the opportunity. While earning a degree is an investment in your future, you should also be looking at your options when it comes to funding your higher education.

Very few people have the total cost of their tuition sitting in their bank account ready to go. To avoid as little out-of-pocket expense as possible and borrowing as little as you have to, rely on your school’s financial aid department. 

Advisors can help walk you through how to apply for financial aid and even point you in the right direction for additional scholarships. Lean on their expertise while it’s available to you, because how you’re covering your college bills can have a large impact on your future finances.

Pay Down Debt

Student loans are one of the most dreaded parts of pursuing higher education. Most students will apply for them to cover their cost of attendance and any additional costs they’ll have. One of the hardest days for many post-graduation adults is the day their grace period ends and student loan debt kicks in.

Many younger students may not realize if they have the means, they can and should be paying off their student loan interest while in school. Reducing the interest before your repayment period begins will help you pay less money over the life of your loan and can even help lower your post-graduation monthly payment. 

Of course, not every student will have that extra money laying around to put toward interest payments. If that’s the case, make sure you’re only borrowing what’s necessary. You should also familiarize yourself with the terms of your loan so there are no surprises when you begin paying, and even look into other repayment options.

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Cut Excess Spending

Being surrounded by your peers all of the time, it’s easy to spend money on things you don’t need while in college. But your coffee runs, online shopping, and other unnecessary purchases will add up in the long run. To avoid upending your budget, look for ways to spend less money. 

For example, many college students have a meal plan of some kind but will often opt to eat out. In this case, you’re essentially paying twice as much for food. While it’s not necessary to completely stop eating out, you should limit the number of times you do and instead use your meal plan as often as possible.

By cutting back on unnecessary spending, you’re saving more money you can eventually put toward necessities. Plus, you’ll be building good spending habits now that will come in handy when you’re balancing larger expenses in the future. 

Build and Control Your Credit

Some young adults will use college as the opportunity to open their first credit card account. While it’s good to begin building your credit, it should also be done with caution. Remember, the patterns and expenses you have now can severely impact your future finances.

With that in mind, not paying your bills, opening too many credit card accounts, or even owning too much can have a negative impact on your credit score. While you might not care too much now about your credit score, it can cause damage later on in life and even hold you back from experiences you want to have.

For example, there’s an acceptable credit score range to buy a home. If your credit score is non-existent because you haven’t built it or it’s too low because of your credit card debt from college, you’re going to have a harder time reaching that life milestone.

Save Extra Money

Saving money can be hard for college students faced with outside pressure and the desire to fully enjoy their experience. That’s not to say you can’t have fun but it’s all about balance. Having extra money on hand is never a bad thing. And, even better, working to save some money while you’re still in college has two huge benefits.

First, you’ll be developing a great habit to bring into the next stage of your life. Second, by putting money away now, you’ll have developed a decent-sized savings for when you need it. If one thing is true, it’s that we can’t always predict the future.

It’s important to be as prepared as you can be for when things go wrong. Saving extra money now can help you build an emergency fund for future crises, whether next week or years later.

Create Value in Opportunities 

College is full of opportunities, and it’s important to recognize and take advantage of these opportunities while you have the chance. For example, there’s immense value in internships for college students. Beyond the lessons and skills you’ll learn, many internships offer some form of stipend or actual pay. 

While not all internships can or will offer substantial monetary compensation, the experience and value they can add to your resume can be great. It can be hard to see beyond your college experience, but when applying to jobs having the work experience of an in-depth internship can make you more marketable to potential employers.

These experiences can even propel you to a higher starting salary or make you quickly promotable in your future career. This is especially true when compared to someone who may lack the experience.

Don’t let your finances feel overwhelming — now or in the future. By starting to get them on track while still in college, you can set yourself up for a more prosperous financial future later on in life.