Taking the first steps to creating a budget can be hard. What should students do to start the process?
Start with a list of known and potential expenses. You can easily find sample budgets online to get you started. You should then edit it to fit your life. Talk to others that have “been there” and can give you insight as to what to expect. Also, be sure to include an amount of the “unknown”. There is always the possibility of the unexpected and you don’t want it to ruin your plan.
What roles can loans, credit cards, financial aid, and scholarships all play in creating a budget?
Financial aid and scholarships: Starting as early as possible in the financial aid process (it’s never too early, even elementary school) can help assure the maximum amount of “good aid”. I categorize “good aid” as aid that does not have to be paid back. This can be extremely helpful in limiting the debt you will accumulate and therefore make it much easier to manage your financial life on your own once you graduate.
Credit Card: If managed properly, having a credit card can be helpful for several reasons. With the credit card in your name, it can help you establish good credit that will be very helpful when you are on your own. It can also be very important during an emergency. The key to managing this properly is to establish what can go on the card and stick to it. For example, it is ok to use it for doctor visits, medications or books. It is not ok to use it for clothes or eating out. You should know how you will pay it off before you charge.
Why is it hard to stick to a budget, and how can students work to do a better job of staying within their financial goals?
It can be hard to stick to your budget when your friends may be spending more money than you have available in your budget. If you see them buying clothes and other things and spending money going to parties and for other entertainment, you can feel pressured or left out. It is crucial for you to have a balance in the way you spend and a good vision of what you want for yourself after graduation. If you keep these goals in mind at all times you can find a balance between how much you spend while in school and building the life you want for yourself once you graduate.