People often say it’s a given that you’ll graduate college in debt. But that philosophy is outdated. Those who don’t want to settle for a debt-laden future can take steps to make sure it doesn’t happen. In fact, you can go beyond simply avoiding debt and actually finish college with a small fortune if you know what you’re doing! Try these tips to build your bank account while you’re in college and start your life on a solid foundation after graduation.
1. Live below your means
One of the most dangerous threats to your wallet is the urge to live up to your friends’ level of spending. You’re not your friends. You don’t have their wallets, family money, or credit scores. You need to decide for yourself if you’d rather spend heavy now and struggle later or save now for a smarter future.
Make smart choices
College students often add on extra debt by trying to keep up with other people’s lifestyles, but studies have shown that to become wealthy, you must start by living frugally. It’s not that hard to enact once you discipline yourself and create a financial structure. In his book , Darren Hardy sums up his philosophy on taking responsibility for your choices. He points out that every choice and action you make today affects the future. The effect could be positive, such as saving money, or negative, like eating too much pizza. With this in mind, make your choices count and take responsibility for them. Here are a few ways to let the "Compound Effect" work for you in a successful way.
- Save more than 10% of your income each paycheck, as recommended by financial experts.
- Buy textbooks, furniture, clothes, and anything else you can find secondhand.
- Stop paying for things you could get for free, like Wi-Fi, required reading materials, or movies. Make use of your local library by getting a card and accessing everything it offers.
2. Be more purposeful in socializing
Minimizing your social circle can help you maximize the value of who you’re friends with. Choosing a smaller group of people to share your interests with could keep you from feeling like you have to spend money to fit in. Along the same lines as optimizing your social circle, don’t jump at every hangout or social event. Decide if each one is valuable to you in the current moment and therefore worth the expense to your future. Planning ahead can help you still have a social life while saving for after college. Look for free and reduced events and . If you limit your shopping and socializing to only free and discounted spending, that’s more money for your savings account.
Related: Where and How to Find Free Events in College
3. Find roommates to share costs
Dorm rooms are usually the first thought for college students on a budget, but living on campus can be expensive and add to student loan debt. On average, dorm rooms cost approximately $10,000 per year. But in a college town, you can often find rentals geared toward students who want to live well without spending a fortune. Financially speaking, you could rent a decent apartment, expenses and all, for less than you’d be paying for a dorm room. The key is to find other students looking for the same thing who are able to take on part of the living expenses, like internet. Find a roommate or two to cut your expenses to manageable amounts. By taking the rental route, instead of living in a tiny room that you’re sharing with someone anyway, you can have a much nicer home while you’re in school. You’ve got more room, more privacy, and you’re still able to save smart for the future.
Related: 5 Quick Tips to Make Things Work With Your College Roommate
4. Use other means of transportation
Owning a car is a symbol of freedom and independence, but it’s also a financial anchor weighing you down. If you own a car and are able to sell it, do it! Add the profits to your savings account to accrue interest, and that’s an automatic influx of cash right there. Not to mention the monthly expenses you’ll be avoiding—gas money, insurance payments, maintenance—will also make a big difference. Most college towns have multiple public transportation options, so keep that in mind and do a cost comparison to decide which is more financially sound: paying for rides or keeping your car. Figure out what works best for you and research the transportation available depending on where you live.
Other transportation options
- Carpooling: Check your college’s bulletin board for ads, or place one yourself, to find others looking to save money and ride together.
- Public transportation: Buses, subways, and other forms of public transit are cheap or free for college students.
- Rideshares: Lyft and Uber are popular in college towns, and you can shave a couple of dollars off the ride by using their carpooling options.
- Eco-friendly options: Get healthy and save money by biking, walking, skateboarding, or otherwise finding a more sustainable way to get around.
5. Bring in an income
Saving is great, but ultimately, you’ve got to have a way to make money to keep saving it. Students who have a full course load are usually steered away from getting a full-time job, and with good reason. But you can keep up your grades and still pull in some cash without sacrificing your lifestyle.
Ways to make money in college
- Apply for scholarships: Some scholarships may be only enough to cover your textbooks, while others could help you with tuition for the year. But every penny counts when you’re trying graduate with money in the bank. So apply for every scholarship that you can find that pertains to you.
- Get a side gig: Working in a restaurant is a great way to bring in income while you’re in school, but it’s not necessary. There are many that you can work from your phone. Just watch out for scams!
- Download phone apps: Find to take surveys, shop for groceries, and play games from your phone. They’re out there, but be aware of scams and don’t give out your personal info.
6. Create a budget
College is a great time to start learning the concept of budgeting. Ask for help from a mentor or trusted advisor if you’re not sure how to get started. Resources like are also available to help you create a budget when you’re ready. Be sure to include:
- Your basic necessities
- Bills and expenses
- 10% of your income (or more) for savings
Set a specific amount as your “extras” budget as money you’re allowing yourself to spend for social events. Keep that amount aside, preferably in cash, so you’re not tempted to dip into savings or charge things to your credit card.
Related: The Best Budget Templates for Students to Master Money Management
7. Learn about credit
Building credit is necessary, but it’s also important to do it the right way. Millions of people drown in credit card debt every year, and you don’t want to join them. To build your credit without going overboard, keep these hard and fast credit rules in mind.
- Avoid high-limit credit cards.
- Stick with one low-limit credit card.
- Don't miss a monthly payment.
- Always pay more than the minimum payments.
- Pay off your balance as soon as possible.
- Don’t close your card—having a long-term credit card in good standing increases your credit score.
Financial habits last a lifetime
It’s easy to take the path of least resistance and spend frivolously, but that pattern becomes a habit that’s hard to break. Discipline yourself. By creating the financial habit of smart spending and saving, your small fortune after college could grow to a large fortune over time.
Pay off some of your college debt before graduation by applying for these easy no-essay scholarships!
