Creating Your College Budget

Budgeting can be new territory for students. Managing money will be one of the biggest new responsibilities for most students. Many students have not had any guidance or education about managing their money. Most people end up learning the hard way and costing themselves a bundle in the process. It is up to you to educate yourself about budgeting and other money matters.
You may be surprised to find out that many college students do not even know what the word budget means. If you think about it, they have, for the most part, never had to worry about budgeting any kind of money because they have always lived at home. At worst, they might need to figure out how to make their gas money last another week.
Adults know how hard it can be to stick to a budget and you should realize that your son or daughter in college will struggle with this as well. It helps to remember that this may be the first time in their lives that they have to discipline themselves, something some adults struggle with.
When preparing your child for college, simply explain what budgeting is in terms that they can understand. Give them an example using a monthly income and a list of bills. Figure out together how much is needed for gas, food, electricity, phone and school. Whatever is left over needs to be divided into savings, emergency money, and fun money. It helps to figure out the monthly budget and then divide the total amount of accessible money into a weekly allowance for yourself. It may help if you open more than one account to keep money separated. A simple way to explain budgeting is to say that it is a plan that lists all of your money coming in and money going out.
Create a template spreadsheet that your child can use to track unexpected expenses month to month. They should note any extra expenses that pop up during each month. Things like oil changes, auto repairs, medical expenses, buying clothes and other unexpected expenses can be planned for to a degree. Keeping track monthly will help them look back and determine if their emergency funds are enough.
Keeping up with the budget will be challenging and you should not expect them to be really consistent. Expect setbacks and be supportive of the efforts that are made. Offer remedies for mistakes, such as taking out cash on payday instead of using a debit card or checks is a very effective way to stick to a budget. When the money is gone, you know that you are not allowed any more. Encourage your child to leave their debit card at home so that they are not tempted to spend any money from their bill or emergency funds. If there really is not enough money to get them through, then you may consider student loans to bridge the gap.

About the Author: Evelyn Saunders, a retired teacher, is the editor for student-loans.net, a provider of student loans and information on how to get private student loans as well as consolidation. For more information, please visit http://www.student-loans.net.