Parents, if you have a child who is also a college student, especially if this is his or her first college year, you may be wondering about how s/he is handling finances. You may already have a clue, based on what you have observed about their spending habits at home. However, being away from home, among a broad demographic (and economic) mix of other students could effect changes in their approach to handling money.
I’ve mentioned before about my days (daze?) in college. Every week or two, my parents would send me a letter with a five- or 10-dollar bill enclosed. Those bills were the old, now rarely found Silver Certificates, not the Federal Reserve Notes we have today. Ah, those great old gold-standard days!
Anyway, I didn’t have a credit card, part-time campus job, or financial aid overage in my checking account to support my spending habits. In fact, I didn’t even have a checking account. Those were the days!
My “budgeting” process was rather straightforward: Did I have enough (any) cash on hand to do or buy what I needed? Very simple.
Today things are ridiculously different, as all you college parents know. So, the challenge becomes keeping an eye on your college student to make sure that s/he isn’t spending like a drunken sailor. (I can note that simile with impunity because I was in the Navy and have seen firsthand the effects of alcohol and fiscal-related behaviors.)
Anyway, I came across an interesting set of guidelines that may be helpful in evaluating your child’s spending habits on campus. These insights come from Brad’s Deals, a site focused on saving money in general. Let’s take a look at some snippets from 8 Common Ways College Students Waste Money.
The college years definitely have their ups and downs. It’s an exciting time filled with making new friends, gaining an education, figuring out what direction you want your life to go, and, hopefully, having fun along the way. But there’s a lot of stress, and for many, the biggest stressor is money. To help ease some of that anxiety, learn from other’s mistakes. Here are eight things college students waste money on.
Dave says: I can think of a few more than eight, but I’ll give Brad the floor for now.
– Owning an car you don’t need
Take a bike to school instead of a car to save money. Between insurance, gas, parking, and the actual costs of owning and maintaining a car, you’re better off ditching it if you’re living on campus. Most colleges offer shuttles or bus services around campus, plus you have the option of biking and walking as well …
Dave says: Get a good bike lock!
– The wrong credit card
… If I were in college, I’d opt for the Discover It Card because if you misplace your card, which I may have done a time or two in my college days, you can freeze it immediately with their mobile app and manage your account with the app. I would have appreciated earning cash back for every purchase. Plus, it’s a great way to start becoming more financially aware with getting your free FICO credit score every month …
Dave says: I have a Discover Card and the free credit rating is very cool. The cash-back thing isn’t all that significant unless you’re putting a huge amount of purchases on the card.
… If you’re already paying for a meal plan utilize that before you head out. If you have access to a kitchen, make meals at home instead of always going out. Take advantage of on campus events that offer free food, and sign up for restaurant e-mail lists … Don’t forget to keep an eye on restaurant deals in your city …
Dave says: I can remember all those Howard Johnson Friday all-you-can-eat fish fry days. We wouldn’t eat for a whole day and then hit HoJo’s in the late afternoon. There was no way they were making a profit on us!
– Taking the wrong class, failing a class, or dropping after the allowed date
If you drop a class after the drop date, you are still charged for the entirety of the class. Know the drop date, and seriously consider if this is the right class for you prior to that date. Failing a class means you are still paying for it, but it doesn’t count towards what you need to graduate. If you’re struggling, reach out to the professor to ask about a tutor or other assistance. Switching majors or misunderstanding your required courses can mean you’re spending a lot of extra money on classes and supplies you didn’t need to take … If you’re not totally sure what is the right major for you, consider taking your general education classes first …
Dave says: This is a critical area. Keeping track of the drop-add timetable can be a challenge, especially for first-year college students. I recommend finding out as much as possible about the courses you plan to take before school starts. Check student opinion sites to see what others have to say about certain professors. Then, keep a sharp eye on the date so that you don’t take a major hit on a course that you drop too late.
– Entertainment and activities
If you’re spending a ton of money on entertainment and other activities, you’re doing something wrong. Chances are, your college has plenty of things to do for free. Cancel that gym membership if your college offers a fitness center. Check out your school’s activity calendar, plus keep an eye open to the boards around campus to hear about free concerts, art exhibits, club activities, sporting events, [and] movie showings …
Dave says: I couldn’t agree more, especially about colleges offering a lot to do on campus. Today’s college students are catered to as never before. Why, back in my day … (I’ll spare you. :-))
Brad offers three other cool tips, but you’ll have to visit him to see what they are. Parents, here’s to fiscal conservatism for your collegian!
Be sure to check out all my admissions-related articles on College Confidential.