College Students: How to Manage Finances, Even When They're Slim



Learn how to manage even meager finances and you can graduate from piggy bank to bank account.

No one is born with money management skills. It takes time, some effort, and a bit of dedication to understand how personal finance works. Years from now, you will probably still be learning. Most people are.

However, the basics of managing finances are something everyone needs, and anyone can learn. The time for responsibility with money isn't after graduation, it's now.

There's More to Having a Bank Account than Opening It

Bank account management is a skill that all college students should know before leaving home. If not, it should be at the top of the list soon after. Opening a bank account is one thing, but knowing how banks operate and how to keep an account in the black is learned.

While banking has changed dramatically, moving from writing checks and keeping check registers to predominately making debit transactions and online banking, college students should still understand how to balance an account. This is the simple act of adding up deposits and subtracting withdrawals, but of course it can be a lot more complicated than that.

Not all charges show up with online banking immediately. When you swipe your card to buy a pizza, the transaction might post to your account and be visible online when you arrive back at your apartment or dorm room. If you fuel up your vehicle on a Friday afternoon, it might be one or two days before it shows up online. If you pay a bill, such as for Internet or a utility, the transaction might not post for several days.

Looking at your current available balance isn't the best way to manage a bank account, especially when funds are thin. One transaction that hasn't posted yet can be the difference between money in the bank or money owed to the bank. Overdraft fees are expensive, often as much as $25 or $30 for each occurrence, and seem to show up when you can least afford them. An account with too many overdraft fees could be closed by the bank, which makes it harder to open a new one.

Credit cards aren't necessarily bad, but just be sure you can make the payments on time every time.

Consider Offers of Credit Responsibly

College students might receive offers of credit, such as gasoline credit cards, department store charge cards, or even major credit cards. Weigh the pros and cons before you take on the responsibility. U.S. News and World Report explains that new legislation limits the way credit card companies can market to college students. But that doesn't mean you won't have an opportunity.

Credit can be a good thing. Without it, you have no credit rating. A good credit rating can help in many different ways, from getting a job and finding a new apartment to obtaining a vehicle loan once you're ready for that level of financial responsibility.

Credit can also be a bad thing if it's mismanaged. Your credit rating doesn't just reflect all of the payments that you make on time. If you forget to make a payment, or make one late, your credit report will show that, too.

Consider offers of credit with a full understanding of the responsibility. Used conservatively, a credit card can help. Used without discretion, your credit report might suffer long-term effects lasting seven years or more.

Create a Budget and Manage Your Money Consistently

"Budget" isn't just a word for people with large incomes and stable jobs. A budget now can help in two ways. You'll learn how to live within your means in college and have the fundamental skills for managing more money later. can help you create a budget that works for your unique situation. Not only that, it gives you access on a home computer or a smartphone. You can keep track of where your money comes and goes, and see it all in real time no matter where you are. It even works when you spend cash.

Sign up for your free account today and learn about all of the ways can empower you with control over your personal finances, even if they're Ramen noodle-slim.