Budgeting never sounds fun, especially if you’re a student who has to do it for the first time. With the stress of school, money management often slips down your list of priorities. But budgeting has to start at some point, especially if you’re dealing with student debt or you went a bit overboard on Black Friday. Here are some simple tips to make getting started a little easier:
Make a Budget
The first step to budgeting is to just create a budget. This can be as simple or as complicated as you want. The basic components of a budget are making a list of your regular income and regular spending. Start by listing spending that’s absolutely necessary such as rent, tuition, phone bill, and et cetera. Just seeing how these numbers add up can often be a shock. Compare the sum of your necessary spending with your regular income and savings to determine how much you want to budget for recreational activities such as going out to eat or your Netflix subscription. If you have regular income, make sure you “spend” some of that by putting it into savings first before considering it spending money.
This can be done easily using spreadsheet templates, websites, or apps.
Track your Spending
Though this sounds tedious, tracking all your spending for just a week can lead to some really eye opening results. And having to track how much you spend keeps you mindful of your spending, making you reconsider if you really need to buy that third $7 latte. (Bonus tip: another way to be more conscious of spending is by paying with cash rather than card). Doing this on a phone app is especially useful because you can input your spending quickly on your phone while waiting in line. Many budget apps have a spending tracker built in so you can automatically tell if your spending fits in your budget. Some even connect directly to your bank account so you can track with minimal fuss. My favourite app is Daily Budget because it is simple, quick to set up, and tells me how much “extra” money I have to spend each day.
Find Free or Cheap Alternatives
Once you know how much you should be spending and how much you actually are spending, you’ll probably want some ways to cut back on spending. One of the easiest ways to save money is by finding cheaper alternatives for things you’re currently spending money on rather than giving up them up. I’ve been able to cut my grocery expenses in half while cooking more often just by switching to a cheaper grocery store and checking the flyer before shopping. Universities and colleges also offer many free resources that you may not expect and many restaurants, retailers, and services offer student discounts.
You may be surprised by how taking the cheaper route is sometimes more rewarding. For example, buying used textbooks sometimes means you’ll get important parts of the text already highlighted or some useful notes written in the margins. And not only does cooking at home save a lot of money and take almost the same amount of time as going out to eat, doing it with a friend is way more fun than making small talk and pretending you don’t want to check your phone at a restaurant while waiting for your food to arrive. For recreational activities, you can check out websites and social media pages for your school and community for free events in your area or join clubs on campus.
These three simple tips that can get your money management started with minimal effort in just minutes!