College is one of the crossroads in the life of young adults. You are still adhering to the school schedule that you have become used to in high school but you are given the freedom that comes with being an adult. You can make choices that have lasting impacts and can shape your life based on those decisions.
This also includes the financial decisions that you make while in college that can have an impact on the future, possibly many years into the future. Knowing how to handle money and your finances going forward can be hugely important towards your financial future.
Manage Your Debt
One of the biggest financial issues for students in the United States is managing student loans. If you plan to attend a major university and don’t either have a huge amount of money saved (typically through a 529 plan that your parents or a family member have set up) or scholarships to cover the costs of your tuition, you will have to take out student loans.
These can be a huge financial burden that you are left paying off for years. The best way to handle this is to formulate a plan to address that debt. It might not happen quickly but knowing how you plan to pay it down will help you stay on plan and focus on paying it off.
Create a Budget
Budgets are useful at any venture in your life but can be especially valuable when you are younger and don’t have as much income. Knowing where your money is going and when can help you avoid scenarios where you find yourself with too many bills and not enough money.
Allocate your spending, know where your money is going and what you might need to cut back on. This might not sound fun, but it will prevent you from running into a situation where you can’t afford to pay your bills.
Credit Can Be Your Friend
It is important to build your credit up and the only way to do that is to take on debt such as a loan (auto, home, school) or to open a credit card account. Doing the latter can be very helpful for tight situations in college so long as you are responsible and pay your monthly balances.
Having this for emergencies can get you out of a tough bind and you can pay off the balance later that month or over a couple of months.