As college students our main focus is usually preparing for exams, completing assignments, and trying our hardest to excel in our classes. We tend not to think too much about saving money because it’s often pretty scarce and we worry about having enough of it to pay current bills, never mind our impending student loans. Saving money takes a backseat to the other pressing financial responsibilities in our lives.
For the past three years, I have been working as an assistant at a local insurance and wealth management company. The time I have spent there, focusing on other individuals’ finances, has caused me to take a hard look at my financial future. Right now, it’s not looking too hot. However, there are a few things that I and other college students can do right now to save and prepare for a stable financial future.
1. Think small
You don’t have worry about saving every extra dime to put into high interest investment products. You can start small. One great way to do this is by creating an emergency fund. This can be your safe zone if you get a flat tire, or a speeding ticket, or you have to make an unexpected visit to see a doctor. Once you’ve locked down that emergency fund, even if it’s just a few hundred dollars, saving for the future will be a lot easier. If and when you are strapped for cash, you can dip into your emergency fund, and leave your actual savings account untouched. This can help it to thrive.
2. Be alert to bank fees
Large banks often impose hefty fees for overdrafts, monthly maintenance charges, or not meeting an account minimum. It seems a little harsh to punish students for not having enough money in their accounts. Moving your money to a smaller bank or local credit union can be a great solution. Often times, local credit unions forgo some of these fees. You’re also ensuring that your money is staying within the community. If you want to ditch bank overdraft, minimum balance and check maintenance fees all together, there are some reputable online banks that you might want to check out like Ally or Simple. Eliminating or reducing bank fees puts that money back into your pocket or savings account.
3. Monitor and limit your spending
Be careful how much you spend on frills. Is frequenting Cinci every weekend necessary? Will Chick-fil-A cease to exist if you don’t eat lunch there everyday and instead make yourself a peanut butter and jelly sandwich at home. Of course not! Going out for drinks with friends every weekend and eating out everyday can be pretty detrimental to your bank account. And these aren’t the only culprits. Impulsive spending, online shopping, and maintaining a subscription to every streaming service available are a drain on savings as well. By starting to become mindful of exactly where your money is going, you can start to make some cuts where you have been spending too much. Mindful spending is a great tool that, if cultivated now, can help you in the years to come.
I realize that saving money may not be a priority for students with other things on their minds, like exams or going to a weekend party. But taking these measures now can establish a life-long savings habit that will lead to a more secure future.