This post is all about solutions for financial problems of students.
People say that being a student is a full-time job, and they’re absolutely right. You have to deal with staying on top of your schoolwork, maintaining some type of social life for your own sanity, and still having some play time of your own. Add work to that, and you’re stressed.
So, whether you’re in high school or college, this is the post for you to get ahead of your finances and stop getting so stressed because you have a lot going on. Let’s take some of the pressure off.
This post is all about solutions for financial problems of students.
TOP SOLUTIONS:
1. Define your top three favorite categories to spend money
Deciding on your three value categories is a two-step process. The first step is thinking about what your categories are. Get specific. Think going to the movies, eating out, and gift-giving.
Then, once you decide on your categories, go through your bank statements. Pull your debit card, credit card, etc., and go through your finances. Before you panic, stop yourself and remind yourself this is a judgment-free zone for you to grow.
Decide on your categories and figure out if that’s where your money is going. In the process, you might realize your categories need to change or you need to shift your spending habits.
2. Create a budget to meet your financial goals
Before you bust out in hives from reading “budget,” remember that budgets only exist to benefit you. There are lots of financial figures who will get you to hate budgets. And the reason why is because they’re shaming you for spending.
We don’t do that, here. Instead, we focus on getting our money to do exactly what we want, which is why we budget. We make goals—sometimes, they’re not goals and more like things we have to spend on to survive.
So, make your goals (anything from “pay my rent” to “find a part-time job”) and create a budget that helps you meet those goals. Clearly, there are some factors we can’t control, but we’re going to do our best to control what we can.
3. Schedule time for schoolwork
As much as money is the biggest factor in our mental health, especially when we don’t have enough to survive, we need to remember that we’re students first. When we’re in high school or college, we need to treat that as a first priority as much as possible.
This might look like you work most of the hours you’re not in school or maybe you work ten hours a week and you’re doing great. Either way, you want to put time down in your schedule where you will dedicate yourself to studying or doing homework.
While school isn’t the only way to get higher-paying jobs down the line, you need to prioritize it if that’s the path you choose.
4. Look up your credit score
First of all, you’ll want to read up on what credit scores are. TLDR, they’re often referred to as adult GPAs and they’re used to decide if banks will take a chance on you.
While multiple factors go into them, the biggest ones are your credit history length, how much you borrow, and how much and consistently you pay back. So, if you’ve never had a credit card before, your credit history is likely zero. Avoid the panic, you’re fine. Keep reading.
In the next step, we’ll talk more about credit cards. For now, keep in mind that you may not have a credit score if you have no credit cards in your name. If you to, you want to make sure you’re paying them off every month (or paying down the high-interest debt).
5. Decide whether a credit card is right for you
Credit cards are great tools, if not kind of stupid to begin with. The whole idea behind them is that you have this money you can borrow from a bank as long as you pay interest. But, in reality, we never want to borrow with credit cards if we can help it.
Not only is credit card debt (AKA spending more than you can pay for the month) super high in interest (you’re paying way more than you actually borrowed), but it’s also bad for your credit score.
So, credit cards are a great tool if you use them like a debit card, meaning you don’t spend more than you have. Whether you’re ready for a credit card now (get a student card, if you are) or not, now you know and knowledge is power.
6. Talk to your lender (after you read up on loans)
The odds are, if you’re in school, you don’t have to pay your loans until you graduate. So, if you’re currently in college, you don’t have to worry about loan payments just yet. But, you will have to think about them and factor them into your long-term goals.
So, let’s talk. Banks generally never have your best interest at heart and, why? Because of interest. They want to make money off of you. This doesn’t sound great, but it’s completely fine in the context of student loans.
However, you should be aware of exactly how your loan lender is making money off of you and you want to make sure it fits within your goals. So, read up on terms like interest rate and minimum payments.
There’s no shame in money moves (like deferment) as long as you know they’re going to get you the outcome you want—regardless of what the bank wants.
7. Seek out resources (scholarships, grants, work-study)
Always apply for financial aid (FAFSA), no matter how likely it is you’ll get it. Some people get their entire tuition paid by financial aid in the form of grants and scholarships.
That reminds me: apply for that scholarship. You’ll probably be surprised by how many you’ll qualify for and actually get. Other forms of financial help include work-study, which involves you getting a job that will help pay your tuition while you’re in school.
Bottom line: apply for financial aid and scholarships. But, don’t get us wrong, you can take out loans. Make sure you’re taking out loans that you can reasonably pay back.
8. Open a Roth IRA retirement account
You’re never too young to open a Roth IRA retirement account and start contributing. You can start with five dollars a month or try and max it out, as long as that’s financially reasonable.
Either way, open an account and put some money in there. Yes, it’s the stock market, and, yes, you’re probably not an expert. That should not stop you from investing. Instead, use a Roboadvisor (we like this one) and make sure you’re putting money in.
The top rule about investing is the longer your money sits, the more money you make because it’s guaranteed to grow over time. So, when you’re talking retirement at the age of 15 or 18 or 21, any money you contribute will make future you is set.
9. Open an HYSA account
Like we talked about, banks like to make money off you. HYSAs are one of the best solutions for financial problems of students.
HYSAs are your chance to make some money off of them using your money. High-Yield Savings Accounts are accounts that hold your money and give you interest payments monthly.
This is the good type of interest that will take your dollars and put them to work for you from doing nothing but sitting in a bank account. No matter where you are in your journey, you need one of these because it, unlike most money tools, has no downside.
10. Write down five, unattainable financial goals
Whether you’re a freshman in high school thinking ahead or a college student stressing out about becoming an adult, you’re not thinking about financial goals down the road.
Buying a house seems impossible. Vacations are way too far off to consider. All of your goals center around the moment: paying tuition, paying rent, and affording food. That’s all completely fair.
But, it also kind of sucks to think about how limited you are because of your finances. So, let’s dream big for a few seconds before we get back to our daily lives.
Get your Notes app out or a piece of paper and write down five of your most unattainable goals. What do you want to do in five or ten years? Vacation? Get a house? Get married? Have kids? Support your parents? You write that down and remember it.
11. Prioritize your mental health
Chances are you’re stressing over money. Maybe you have a reason to, but, also, maybe it’s not helping you improve your finances. Stress and anxiety are natural and important responses to the world around us.
But, they activate way too often now. So, when you’re stressed about finances or worry about your financial future, remind yourself this is healthy. But, also, ask if it’s useful.
Plus, you should probably watch your favorite show or go to lunch with your friends because you deserve to be happy—and you need to prioritize your mental health 100% of the time.
