Saving money in college can be a challenge. Between paying for tuition, room and board, books and food, your money gets spent almost sooner than you can make it. And when this is the case, how are you supposed to even begin creating savings for yourself, let alone have enough money to survive through the next semester? Luckily, with a little planning and determination, you don’t have to be one of the many who graduate from college with less than zero dollars to their name. To show you how, here are three tips to help you create savings while living as a poor college student.
Build Your Emergency Fund
One great way to begin creating savings for yourself is to start building your emergency fund. As a college student with very limited funds, emergencies that require you to fork out a decent amount of money can be crippling. To keep this from happening, Trent Hamm of TheSimpleDollar.com recommends for everyone to make a healthy emergency fund their priority. For college students, it’s important to remember to start small and set your intial target amount low enough that you don’t become too overwhelmed. Hamm suggests starting at reaching $250 or $500 in savings as a great initial target.
If You Have a 401(k), Contribute What You Can
If you’re working while going to school, you may have access to a 401(k) retirement account before you even graduate. If you’re not working or don’t have the ability to contribute to a retirement plan, this tip will have to wait until you get your first job after graduation. However, Clark Palmer, a contributor to BankRate.com, recommends for any college student with access to a 401(k) account to begin contributing as soon as possible. Although retirement seems like a distant dream at this point, contributing early—at a suggested rate of 10 percent—will help you to quickly and effectively build your savings.
Set Up A Plan for After Graduation
For some, creating savings while in college just isn’t in the cards. If this sounds like you, the next best thing you can do is create a plan for how you’ll handle your money after graduation. While in college, you likely had tricks for saving money on certain items. Now that you’re graduated, saving money is just as important, if not more so. To help you set up the best financial plan, Charles Passy, a contributor to MarketWatch.com, proposes 7 things graduates should do with their money right after college. Some of these actions include figuring out your plan to pay off student loans, making a budget, getting the right insurance and more. By doing these things, you’ll be putting yourself in a financially safe place for your future.
Even if you’re not making much money while in college, you still can work toward developing savings so you don’t constantly feel financially insecure. Use the tips mentioned above to help you get to a healthy savings level today.