For students starting college is filled with new freedom and responsibility. It’s an exciting time in so many ways, including the first step towards financial independence. It’s also expensive– over 44 million Americans hold a total of $1.5 Trillion in student loans that take, on average, 20 years to pay off.
To master this life transition and not fall into expensive debt, it goes a long way to be disciplined and organized. The best tools and solutions are often the simplest ones that automate the things that matter most and make them part of daily life.
These five steps can help any incoming student start off on the right footing and be setup for for a strong financial future.
1. Create a budget
The first step of course is to create a budget. It can be something simple that makes it easy to plan how much can be spent in total and on each category. The best approaches tend to be simple ones that are easy to follow and stick with.
If you’ve never set a budget before, the best place to start is to figure out how much you can afford to spend each week (or month) and then transfer that into a dedicated spending amount. That way you will be able to easily track how much has been spent out of the budget and how much is left.
2. Start saving early and often
The most important thing to increase savings is to prevent overspending. Having a budget helps. It also helps to seek out discounts and offers that can help save more. Even if its small amounts, these savings can add up and compound over time. And students are often eligible for special offers and steep discounts that may not be available to everyone. Take advantage of these and start compounding your savings as early in life as you can.
3. Be careful with debt
As students some forms of debt like student loans are often unavoidable. But there are ways to minimize debt and this can be one of the most important things to get right for long term financial prosperity. With rising interest rates it’s increasingly important to minimize student debt, and avoid high interest credit card debt. Most colleges have a plethora of resources for financial aid– and these are often underutilized. Apply to as many grants and scholarships as possible. You might be surprised by the number of opportunities you’d be eligible for. Carefully plan a path to graduate on time to prevent extra tuition fees. And yes, avoid high interest credit card debt at all costs.
4. Explore campus jobs
Having a part-time campus job is a great way to cover personal expenses while also building valuable work experience that can improve future job prospects. College can be a fantastic time to try lots of different jobs to find what you love and enjoy most, while building an income stream of your own. In fact, research from the National Center for Education Statistics shows that students who work earn better grades, because it helps them structure their time and is a good non-academic way to connect with people on campus. (btw– check out the Atlas Ambassador Program as well.. It could be a great option to explore)
5. Start building credit
One of the most important financial steps that students must make is sometimes one of the hardest– establishing a credit history. One of the key factors in a credit score is the length of credit history. So it’s critical to start as soon as you can so when you graduate you already have an established credit.
Credit cards are a great way to build credit. However it can be particularly difficult for students to get a credit card because they often have no previous financial record. Approval rates are as low as 16% for students. Worse, it requires a hard credit check which can hurt your credit to apply, and if approved you carry the risk of slipping into extremely high interest debt.
Another option for students is to get a modern zero interest card like Atlas. It’s a credit card that pays off the balance as often as daily with Smart Pay to prevent the risk of building up debt or paying interest. And even better– there’s no credit check or income requirement so any student can get approved and start building credit as early as possible.
There you have it. Five easy ways to set yourself up for a brighter future. At Atlas we are committed to helping you succeed. To help with that we’re putting together an exclusive student community for financial tips and a place to share tips with each other. Just sign up for the card, and we’ll send you an invite to join the community.