5 Money-Smart Strategies for College Students
Help your student use the college years to build good money habits.
College can often seem like a time when money woes are more common than money victories—after all, school expenses and potential debt can lead to feeling overwhelmed by finances instead of being in charge of them.
But your college student can use these formative years to build foundational money habits and create a path to financial independence. Here are a few smart money moves any college student can make.
Sign up for a free checking account.
While typical checking accounts require minimum balances, or fees ranging from $4 to $25 per month, most banks offer some kind of free student checking account for students under the age of 24 who are enrolled in college. Student accounts generally allow for ATM transactions, a free debit card, mobile, and telephone banking, and helpful tools such as bill pay, e-statements, and alerts, which help students keep track of balances and payments to avoid overdrafts.
Get a no-fee student credit card.
Building and maintaining good credit is one of life’s big financial requirements. One of the best ways to build credit is by making small, regular purchases and paying them off each month—on time. For example, putting gas, books, or a utility payment on the card, and then scheduling an automatic bill pay to ensure that monthly expense is paid right on time, helps create a record of regular, on-time payments. This helps improve a student’s credit score—useful for when filling out a lease for an apartment or applying for a store credit card, a student or auto loan, even some jobs.
Work while in college.
It can be tough to balance studies and the demands of a job but working while in school not only helps teach planning and organizational skills, but it keeps a steady flow of cash coming in for all of student life’s expenses, from late-night pizzas to school fees or rent. Working on campus is ideal, as campus jobs are generally tailored to fit a student’s schedule. One of the best? Working as a resident assistant, or RA. RAs help students adjust to dorm life and serve as a sort of mentor/camp counselor for residents, usually in exchange for free room and board—which adds up to thousands of dollars a year. RAs can earn additional money working extra duties such as staffing a front desk.
While on-campus work is handy, don’t overlook the potential of lucrative side hustles. Driving for DoorDash or Instacart, babysitting, tutoring, or house sitting are some of the more obvious, but there’s money to be made online, too: blogging, managing social media, data entry, doing graphic or web design, offering online editing or help writing papers, participating in surveys and market research are just a few options where a student never needs to leave their dorm room.
Never make a late payment.
Late payments cost money in plenty of ways. Not only are students on the hook for late fees or bank charges, but a record of late payments will result in a lower credit score.
When students keep a low balance and don’t carefully track transactions, it’s easy to have overdrafts—where you spend money in your account that you don’t have. So not only does it leave students in debt, but banks charge a fee to process the transaction, leaving them even more in the hole. The solution? Use the bank’s online banking app to check in regularly, and set up account alerts for low balances.
It’s never too early to create financial health, and the college years are an ideal time to foster financial literacy and independence. The Aspen Wealth Strategies team is here to help parents reach their college savings goals or get their students on track for a lifetime of financial wisdom and wellbeing. Chat with an advisor about how we can help make the college years a success.