Are you totally lost when it comes to finances, budgeting and investing? Me too. I took a personal finance class in high school which was a great building block for me, but I’m no “business bro”. Recently, I have been embarking on a journey to educate myself about personal finances and budgeting. Let me do all the heavy lifting research and I’ll share it with you here!
College is weird because everyone’s finances look so different. Whether you work 5 hours a week, 20 hours a week, or have an allowance- understanding finances is still very important.
Another thing I want you to note is that there are multiple things you can do to improve your money management but no, you shouldn’t do them all at once. Baby steps.
1. Create Your Own Bank Account
In high school some of my friends did not have their own checking account or savings account. They had no responsibility over their money and their parents allocated money to them each time they went out to eat. If you are in college, you need to have your own bank account and be responsible for managing it.
2. Create A Savings Account
If you have your own bank account, do you have a seperate savings and checking account? If the answer is yes, great! Having two different accounts is key to the begining of saving and budgeting your money. It will let you store your money away so you won’t be tempted to spend it, and will earn interest (not much, but some!).
3. Save A Emergency Fund
Your first savings goal should be an emergency fund. This is money you can use for sticky situations such as your car breaking down. People typically recommend $1,000 for an emergency fund.
4. Start Budgeting
Before I began budgeting, I created an Excel document to breakdown what I was spending my money on. Once I tracked my spending for 2 months and noticed my habits and average money spent on groceries, etc. then I was able to create a budget.
Here is what one week in my Excel document looks like. I categorize my spending into 5 categories + savings. If you want to set this format up yourself, create a document and type into it like so. Then, you can set up the document to do the mathmatical work for you. Here’s how:
- Go to the “left over” cell under the “actually spent” column and type in =
- This will turn your curser into a plus sign and every cell it moves over will light up.
- Use your curser to click on the allowance cell and then press “+ ” on your keyboard and then click on the work cell and “+” and then click the income cell. This will add the values in these three cells.
- Then, press”-” on your keyboard and click one of the spending category cells. Continue to press “-” and then a spending cell until you account for all of them. When you are done press enter on your keyboard.
- You are subtracting all of your spending from your income. So in words it looks like this: income+ allowance +Other- Groceries- shopping- gas-restaurants- savings- other= left over.
- In Excel it will look like: C70= C60+C61+C62-C63-C64-C65-C66-C67-C68-C69
You can click on a cell, press shift then click on the bottom cell and the cell to the farthest right to select the whole weekly set up and copy it. I then pasted that throughout the document to account for each week of the month.
At the bottom of my document I took note of the average of each spending category. So for average gas, I typed in =average and then clicked on the cells with values that I wanted to be averaged (make sure to put a comma in between each cell). It will look like this =AVERAGE(C8,C22,C36,C50,C64). This is how I keep track of what my average spending is for the month. This value allows me to put my data into a pie chart to visualize my spending.
I also take note of how much I saved that month, and what percent that is of my total saving goal. So say I saved $100 and my total saving goal for the year is $1,000, then I am 10% of the way. I like to do this so I can see how I am coming along with my goals.
To make it easy on you, download my template below
5. Start Building Credit
Many college students have the goal to live on their own without the help of their parents after college. In order to do this, you will need to build up good credit. Which means it is time to get a credit card. I did a lot of research on the best credit card for college students and was really pleased with Discover It Student Cash Back Card. Here are some of the perks:
- All purchases automatically earn 1% cash back
- With Cashback Match, get an unlimited dollar-for-dollar match of all the cash back you’ve earned at the end of your first year, automatically.
- Each quarter, the card rewards 5% cash back on different categories. For example one quarter may be restaurants and PayPal, and another may be Target, Walmart and Amazon.
- There is no annual fee. The APR is 0% for your first six months and 12%-21% after your first six months.
- Earn a $20 statement credit for GPA above 3.0 each school year
- Email and text alerts about your statements and when payments are due.
If you pay your credit card on time and in full, then you will not have to pay the APR and you will be building good credit!
Use my link to sign up for a Discover It card and get a $50 credit when you make your first purchase within three months. https://refer.discover.com/s/mkeeler19
6. Start A Side Hustle!
If you already have a job or are looking for something that can bring in revenue but not take up all of your time- try a side hustle. As a college student this can be photography, babysitting, cleaning houses, tutoring, etc. It is good to diversify your income, and have some extra cash. This cash can be flowing straight to your savings account while you live off of your budgeted main income.
7. Establish Saving and Investing Goals
I have several saving goals such as travel, living independently post graduation, and retirement. I would love to begin investing and start to slowly put money away for retirement but as I mentioned, this process is all about baby steps. If you feel like you are ready for these steps, go ahead and research it. I have been listening to podcasts, subscribing to blogs, completing e-worksheets, and taking online courses so I can gain the knowledge I need and feel confident in my money management. Some podcasts I have been loving are:
- Teach Me How To Money
- The Budget Bitch Podcast
- Life Kit
- The Clever Girls Know Podcast
The Clever Girls Know is something I am SO happy I discovered. It is a podcast created by the owner of Clever Girls Finance blog. This blog has resources, courses, savings challenges and a community to help women understand and manage their finances for FREE. They talk about career goals, investing, building credit, budgeting, saving, debt, real estate and more. Seriously these resources are too good to be free but I am taking full advantage while I can and you should too. https://www.clevergirlfinance.com/
Leave a comment below where you are at in your finance journey, and any advice you have for college girls working up to that point!
Loved this post! Thank you for sharing the spreadsheet. 💕
Thank you Hanna! Glad you liked it!