Budgeting for college students

Jeremy Coppock
Jeremy Coppock

Jeremy is a content writer and editor for Degreechoices. He also has previous experience translating and teaching English. In his free time, he likes learning languages, baking bread, and spending time with his two basset hounds, Chowder and Snuffles.

Budgeting for college students

    Learning to budget by tracking your income and expenses is an important life skill.

    Being disciplined about your spending in college is a key aspect of financial hygiene.

    There are many easy ways to save money that can mitigate your student debt burden.

    We know – college costs are astronomical, and you’re not going to graduate debt-free simply by skipping lattes and avocado toast. But being careful with money as a student can actually make a pretty big dent on your college debt burden. And more importantly, budgeting is a crucial skill that will serve you well throughout your life.

    Learning how to create a student budget and stick to it is vital for your financial hygiene. And college – which is many people’s first experience of independent living – is a great time to start practicing this skill. Below is some sage advice on sticking to a college budget, as well as tips and tricks on saving money for college students.

    How to budget in college

    Budgeting may seem complicated, but it’s not so difficult if you break it down into steps.

    1. Talk with your parents about money

    The first step to budgeting is having “the talk” with your parents or primary caregivers. Communication with parents is key, because they have information you need in order to complete your FAFSA, which is a form you fill out to apply for financial aid.

    If your parents won’t help you out by submitting a tax return for your FAFSA, you may not be eligible for financial aid, so make sure they understand how important this is for college. Try reaching out to your school guidance counselor for advice if your parents are being unhelpful.

    If you’re lucky, your parents may have a college fund set up for you, or they may be willing to give you a few hundred dollars a month to spend at your discretion. They may also have valuable budgeting advice for you (boring, but worth a listen). Either way, it all starts with a conversation.

    2. File your FAFSA and apply for scholarships

    If you’re like about 80% of Americans, you will receive some financial aid, be it in the form of grants or loans. This will make up the biggest chunk of your college money. You get financial aid by filling out FAFSA and CSS forms and submitting them to colleges. Don’t forget to search for scholarships as well.

    3. Determine where the money’s coming from

    Once you decode your financial aid letter, you can start listing your income. Income is money that’s going into your bank account. It will usually come from the following sources:

    • grants, loans, and scholarships
    • money earned through a work-study program
    • your parents
    • a student job

    4. Break down your expenses

    Now that you’ve established your income, you’ll need to think about how you’ll spend it. Planning your spending and sticking to budget goals are the most important parts of budgeting. The first thing you’ll want to do is to differentiate between “needs” and “wants”.




    University fees

    Utilities (laundry, electricity, etc.)




    Eating out

    New clothes

    Comic-con tickets

    Decorative feathers

    You can further categorize your expenditures into fixed and variable college expenses. Fixed college expenses, like rent, are the same every month. Variable college expenses, like groceries or gas, fluctuate. Differentiating between fixed and variable expenses will help you establish a more accurate budget.

    One popular budgeting guideline is the 50/30/20 rule, where 50% of your income goes to needs, 30% goes to wants, and 20% goes into savings. It may be hard for you to save that much in college, but it doesn’t hurt to try!

    5. Make a weekly budget

    You’ve established your income and monthly expenses. Now it’s time to make a budget. Use Excel, your online banking provider, or an app to get started. Having a weekly budget, as well as a monthly one, can make it easier to keep track of your spending. Here are some helpful budgeting tips:

    • Pay your fixed expenses at the beginning of the month, or whenever you get your income.
    • Be a pessimist when it comes to variable needs like utilities. You’re better off budgeting a little extra money for groceries than running out of cash at the end of the month.
    • Always put some money to the side. You can invest your savings or create an emergency fund. If you’re very ambitious, you could even start paying off your student loans while already in college.
    • Be disciplined with your wants. Don’t allocate too much of your budget to eating out or shopping for non-necessities.

    6. Track your actual spending

    At the end of each week or month, look over your spending and see how well you’ve been sticking to your student budget. Analyzing your spending can help you adjust your college budget and be more realistic. It can also reveal where you’ve been consistently slipping up and overspending on “wants.” We’re not suggesting that you eliminate all fun from your life in an effort to save money, but being aware of how much you’re spending on coffee and concerts can go a long way.

    Budget example for students

    Below is an example of a budget for Jo, a student in Seattle. Jo gets around $30,000 from his parents and the government, which he spends over the course of 12 months (he takes summer classes). His financial aid includes a tuition discount. He doesn’t manage to save 20% of his income, but he’s doing his best.


    Budgeting tips for students

    Seattle is an expensive city, but Jo manages to get by. How does he pay for his college expenses? Little steps can take you a long way. We have put together a list of college budget hacks that can help you save money as you study. They may not knock out your college debt, but they will mitigate how much you owe when you graduate.

    Save money on textbooks

    There are many ways to save money on textbooks. Buy used textbooks, share them with a classmate, and sell them once you’ve learned everything you need to learn.

    Avoid restaurants

    Avoid eating out at restaurants; they’re more expensive than you think. As an alternative way to socialize over food, consider throwing budget dinner parties with friends.

    Plan meals ahead to reduce waste

    College is a great time to learn meal prep: plan your meals for the week, cook in batches, make grocery lists, and be creative with leftovers. If you end up with random food in the fridge that you don’t know what to do with, try experimenting – or even ask Reddit for advice. Try not to go grocery shopping hungry – you’re more likely to buy junk food.

    Search for free food

    Keep your eyes peeled for events with free food – there are usually plenty of these in and around campus. You might have to learn about someone’s religious beliefs first, but it could be worth it as the end of the month approaches.

    Live with roommates – and maybe not in the dorms

    It’s a no-brainer that sharing your living space with roommates can help you save money. But what might be less obvious is that renting an apartment or house with friends can end up being cheaper than living in the dorms. Weigh the pros and cons of off-campus living and investigate if this is a feasible way of saving money for you.

    Be thrifty

    There are lots of ways to live cheaply if you put your mind to it. Take advantage of student discounts, buy your clothes and electronics second hand, and peruse coupon websites.

    Use public transportation – or ride a bike

    If you live in a big city, taking the bus is probably more economical than driving a car. What’s more, as a student you may be eligible for a discounted public transportation pass. Bikes are even cheaper – and they’re good cardio to boot.

    If you have to use a car to get to campus, try organizing a carpool by posting a notice on a student forum.

    Get a part-time job

    If you have the time and emotional bandwidth, student jobs can provide good padding for your income, as well as giving you valuable workplace experience that will ease your transition to the job market. Being a residential advisor (RA) looks particularly good on your resume.

    If you’ve filled in your FAFSA, you may find that you qualify for a work-study program. Work-study options are good for students as these positions are generally accommodating to student schedules.

    Double-check your financial aid form every year

    Each year, double-check FAFSA to ensure all the information is correct. You could be eligible for more grant money if your parents’ financial situation changes.

    Likewise, you can keep searching and applying for outside scholarships throughout your time at university. In fact, some scholarships may only be available to current college students!

    Final thoughts

    College is a great time to pick up healthy financial hygiene habits. Learning how to balance a budget, limiting your spending, and getting financially literate are all skills that will serve you well throughout your life. Making a college student budget may be boring, but – like brushing your teeth – it will save you many a toothache down the road.

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