Creating a Monthly Budget for a College Student


Creating a Monthly Budget for a College Student

budget for a college student

When it's time to send your child off to college, you can give her the benefit of your life experience by helping her set up a budget and suggesting ways to live within it. While a few factors may have changed since your college days, you can help her reduce expenses and increase income with these money-saving tips.

Creating a Budget

If you haven't done so yet, take the opportunity before your kid departs for college to help her set up a budget. The College Board's 2013 living expense budget sets nine-month costs at $11,690 for low budgets and $17,440 for moderate budgets, beyond the costs of tuition and books. The Board estimates that 34 percent of the budget should go to housing, 14 percent to food, 16 percent to transportation and 36 percent to "miscellaneous." That last category requires the most attention, because you need to budget for clothing, medical and personal expenses. A prudent reserve for medical expenses might be 10 percent, leaving 26 percent to allocate as you see fit. Your child's college may publish sample budgets that you might find useful.

Income Ideas

Assuming you start with a reasonably balanced budget, your child might nonetheless want to supplement her income in ways that exploit her skills and knowledge without placing too much of a burden on her time. Perhaps she can offer to tutor classmates for a small fee or take an on-campus position that still enables her to study -- like monitoring entry to the student library or dorms. You and your child can probably come up with several innovative ways to supplement her income and make it easier to live within budget.

Save Money on Books

Today's students also have money-saving options available through the Internet. Registered investment adviser Elisha Zaretsky suggests, "Want to save hundreds of dollars a semester? Buy used books online -- an old edition is probably almost identical to the new one but could be a lot cheaper." Zaretsky also points to book rentals or e-books as additional money savers when it comes to textbooks. "You have easy access to all your books on a lightweight notebook computer -- no more lugging heavy books to the library,"she says. If a student must occasionally buy a printed book, the Internet can help her sell it when the term is over.

Budget Busters

At 16 percent of your budget, transportation is real budget-buster. If your child lives on or near campus, consider leaving the car at home. The gasoline and maintenance costs she avoids by foregoing car ownership at college can save hundreds of dollars throughout the school year. Food choices can also challenge a budget. If your child is on the university meal plan, it makes sense for her to maximize the value and take all her meals at the cafeteria. Budgets are living documents, so adapt yours to your circumstances. Using personal finance software can help track monthly expenditures and will show you exactly where your money is going.

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