Wednesday, 29 August 2018

There are so many things to think about when you start college. What will your roommates be like? Will your classes be difficult? Will you gain the dreaded freshman 15 pounds?

As if that's not enough, add this to the list: You need to be able to manage money and make smart budgeting and spending choices.

Before a child leaves for college, it's critically important for parents to have candid conversations about what students can expect in terms of financial support, and what parents expect from their kids, says Lynnette Khalfani-Cox, aka “The Money Coach" and author of several personal finance books.

Khalfani-Cox, whose books include "College Secrets: How to Save Money, Cut College Costs and Graduate Debt Free, " is a mother of three with one child graduating college and another entering. She offers a freshman 15 meant to bulk up your money smarts not your waistline. These lessons will serve college freshmen for the rest of their lives.

1. Understand how to budget

There are two sides: Income (from grants, scholarships, loans, work, and parents) and expenses (housing, medical, books, food, recreation, fees). Know that you need to bring in more than you spend, budgets are living documents that can be adjusted as your income or expenses changes.

2. Do you need a car at college?

Besides the cost of the car, there are costs to insure it, park it, maintain it, and keep it fueled. Most campuses are navigable on foot and via bike—ride-sharing services also can negate the need for a car when you go off-campus.

3. Is the Greek life worth it?

When you join a fraternity or sorority, you'll make lifelong friends and join a network that could help you professionally and personally down the road. However, beware of all the fees involved, as well as costs for trips and events that can cost up to $4,000 a year or more. “You can still connect and bond with people around other, perhaps free, shared interests or activities or realms of academia that do not require you to join a professional group or a social group of any kind in terms of having an up front expense," Khalfani-Cox said.

4. Be careful with credit

If you find yourself shifting credit card balances or using payday loan services, you're in over your head and need to spend less or make more. If you borrow money, find the least expensive way and have a game plan for how you'll pay it off. “That's true for student loans, for federal loans, private loans. That's true for credit cards and a car note," Khalfani-Cox said. “College is also that all-important stage at which you can really start to establish a healthy credit rating. … you can rest assured that landlords are going to pull your credit rating when they're trying to decide who to rent to; likewise, having good credit as a young adult can help you in the job market because employers are also increasingly doing employment-based credit screenings."

5. YOLO and FOMO will kill your budget

You might see your friends on social media taking the ultimate spring break vacation or decked out in designer duds, or maybe your favorite celeb has a new accessory line that everybody loves. “You have to abandon that FOMO mindset, the fear of missing out," Khalfani-Cox said. “Social media is just a very carefully curated image of what people want you to see of their lives. The sooner young adults can get that, the less inclined they'll be to overspend and perhaps to get themselves into financial trouble as well."

6. Pick an affordable meal plan

“In general, the mid-range meal plans for most students are really just fine," Khalfani-Cox said. And though you'll probably sometimes want to go out with friends, a smarter way to do that is to eat in your dorm or in the cafeteria first, and join them for dessert or coffee. Also, many schools offer campus bucks to spend—don't ignore them, and use them wisely.

7. Live on campus

“Don't be penny-wise and pound-foolish when it comes to housing," Khalfani-Cox said. You may think that you're saving money by living and eating at home, but the reality is that students who live on campus tend to do better academically and graduate sooner because they're immersed in academia.

8. Become a Resident Assistant

You're usually eligible to become a resident advisor after your freshman year, which entitles you to free room and board—plus you'll have something for your resume. Do know that you'll have to actually be available outside your classes to help students, and you'll have to behave with some level of decorum.

9. Get a roommate

A single room will cost the most; living in a double, triple, or quad will save money. Maybe you'll even make some dear friends.

10. Don't buy new textbooks

You can rent them, use the library, buy them used in your campus bookstore or online, see if there are digital and open-source versions, or even ask your professor if there's an extra copy you can borrow.

11. Save on school supplies

Certain majors have a premium, not only for tuition, but also for supplies, adding a couple thousand dollars to your annual expenses, Khalfani-Cox said. “I'm not trying to discourage people from taking the major of their choice and pursuing their passion, but I am saying you have to pick majors and classes wisely." Think about what equipment you can rent or share with others in the class, and if you can find it cheaper used or off campus.

12. Ask for help

If you can't afford something essential for the class, Khalfani-Cox said to reach out to a tutoring or resource center on campus, and tell your professor about your struggle. Chances are, he or she will be able to lend you what you need or point you in the right direction. “This is not time to have ego or pride," she said.

13. Stagger your classes

If you have a major that requires a lot of expensive equipment or books, try to stagger the classes so that you don't take the financial hit all at once, and fill your space with core requirements and other lower-cost classes.

14. Don't buy useless stuff

You'll be amazed by the things people throw out at the end of the school year – ask yourself if you really need all that school-logo paraphernalia, the popcorn popper, the extra gadgets, or the matching curtains and comforter set. Yeah, didn't think so. 

15. Get organized

If you're forgetful and sloppy, you'll pay for missing tuition payment deadlines, parking tickets, late library books, lost swipe cards, and IDs. That's just wasting money on nothing.

And finally, Khalfani-Cox said, see what you can do to cut way down on your tuition. For example some paying jobs can also count as an internship to help you earn college credits. Also look into studying abroad. “Many international schools have cheaper tuition than U.S.-based schools," Khalfani-Cox said. “Even if my son decides to go study, let's say for example in Germany, his tuition would be nil for that semester. It would actually be a savings. You have to look at those kind of things."

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