While you’re in college, put away that extra money from babysitting, gifts, and part-time and summer jobs—rather than spending it. It will make a big difference down the road! Potential future expenses, such as the deposit and first month's rent for a new apartment, buying a car, or the expenses of an out-of-state move for a job, can make a big financial impact if not planned for in advance.
Get started by doing your homework. Search traditional and online banks for the interest savings plan
with the highest yield and the lowest account-management fees. If you’re likely to need funds in the near future, be sure to choose an account that doesn’t penalize you for early withdrawals.
Here’s how to start building up savings:
- Put yourself on a budget. First, set aside the needed money for tuition, books, housing, and meals. Then, create a budget, using the amount that’s left. Tracking your monthly expenses will give you the information you need to plug those spending leaks and still manage to set aside money to help you move closer to your savings goals.
- Cut out nonessentials. Make a point to stop spending on things you can live without—like meals out, soft drinks, bottled water, gourmet coffee drinks, and song downloads. Developing skills in identifying your needs vs. wants can help you establish healthy savings habits for now and in the future.
- Shop around. If you need to furnish your living space or replace a broken item, check the online bulletin boards such as Craigslist or eBay for deals on televisions, furniture, and more. Often, you can realize savings by purchasing gently used items—but always inspect and test them before buying.
- Get a part-time job. Try to find the type of work that aligns with your interests. For example, if you are planning on a career as a teacher, maybe you can find work as a part-time nanny near campus or as a tutor for younger children. Can’t give up that latte habit? Look for a job at your favorite local coffee shop! Let friends and family know that you're looking for work in case they know of a potential job opening.
- Pay yourself first. Set up a rule in your online checking account so that a certain percentage of your earnings—say, 5 percent to 20 percent—is automatically rolled over into your savings account. If you’re not using an online account, move the money to savings in a monthly, in-person transaction at the bank.
Saving for your future now will be of benefit later, when you have to repay college loans and/or credit card debt.
Learn the different ways you can repay your student loans here
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