If you are like most college students, your top priority is your education, but you can make sure monetary concerns don’t get in the way of your studies by fitting financial management into your schedule. If someone else isn’t footing the entire bill for the next few years, you are responsible for making sure you have enough money for tuition, books, food, housing, entertainment, and/or other expenses. Even if your parents are supporting you now, once you leave the confines of campus, you’ll be faced with a whole new set of costs. Learning to make the most of your money today can help you prepare for tomorrow. This course will cover:

• Money Management
• Checking and Savings Accounts
• Credit Cards
• Household Bills
• Student Loans

Chapter 1: Money Management

Money management is the process of knowing where your money is going now and having a plan in place for where you want it to go in the future.

Setting goals
Goal setting is your chance to figure out what you want and get it without having to borrow. There are three basic types of goals: short-term (achievable in under a year), mid-term (achievable in one to five years), and long-term (achievable in five-plus years). Determine how much your goals will cost and when you want them by.

How much do you need to put aside each month? For short- and mid-term goals, the calculation is simple: the price divided by the months you have to save equals how much you need to put aside each month. For long-term goals, you may want to factor in the interest you expect to earn on your savings. This can be done with a financial calculator.

Budgeting
Budgeting involves knowing what you have coming in and restricting what goes out. A well-designed budget allows you to make the most of your money – you will get rid of wasteful spending while having the cash to pay for the expenses that are really important to you.

When creating your budget, begin with your income, as it determines what you can afford to spend and save. Total up every net (already taxed) dollar you make in a month. If you have periodic sources of income, such as a summer job or living stipend from a student loan, total what you receive for the year, and divide by twelve to get a monthly figure.

Now move on to your expenses. When developing this section, have two columns to work with – a “current” column, for where your money is going now, and a “proposed” column, for the changes you want to make. Like with periodic income, for periodic expenses, like birthday gifts, total what you spend per year, and divide by twelve to get a monthly number. Remember to include money for savings – both for your goals and emergency, unexpected expenses.

Though each budget is unique, one rule applies to everyone – your expenses should never exceed your income. If you find there is more going out than is coming in, it’s time to make changes. You can increase your income, decrease your expenses, or do both. Using the current column as a guide, consider each expense carefully. Which are wants? Which are needs? In the proposed column, finalize where you want your dollars to go each month and what can be cut.

Keeping an eye on cash
Creating a budget often is easier than staying on it. However, following these tips can help:

• Avoid impulse purchases. Have you ever seen something in a store and bought it on a whim? It can be hard to avoid impulse purchasing completely, but keep your goals in mind. Before buying a product, think about if you really need or can afford it.
• Don’t gamble your money away. Many college students blow off steam by gambling. However, when you gamble, you are more likely to lose money than earn it. If you cannot control your gambling, consider seeking professional help.
• Track spending. Knowing where your money is going can help you to examine your spending habits and eliminate expenses that are not necessary.