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Why Building Credit in College is Crucial


poorcreditscoreIf you are planning to head off to college, then last thing on your mind right now is your credit score. While you may have tucked your thoughts about credit into the back of your mind, it is time that you bring those thoughts back into focus because it is important to build your credit while you are away at college.

You may be thinking right now that you can’t possibly understand why you should build your credit now, as you will have years to do it after graduation. Thinking like this can actually set you up for failure in the future. Below, we will go over some of the reason why you need to build your credit now.

It Will Teach You to Budget

One reason you should work on building your credit in college is because it will also teach you to budget. When you have a credit card, you will quickly learn that you cannot spend money simply because you are allowed to. In fact, if you do this, you will actually damage your credit score if you cannot pay the money back.

Some students enjoy having a secured credit card in their possession because it does allow them to build their credit without the worry of going negative or falling into debt from using the card.

If you want to build your credit, you should start out with one card and then add a second one later on. To limit your spending even further, choose a credit card that is store specific, that way, you won’t be tempted to use it elsewhere.

You Can Apply for a Mortgage or Auto Loan

While you are probably not thinking about buying a home or vehicle right now, you will want to at some point and having a solid credit score will help you. As you work your way through college, you should be building your credit now to secure your future.

If you ruin your credit score, it is hard to get it back and will take a lot of work to do so. In fact, many people who ruin their credit score too much will find that they are unable to receive approval for anything they apply for. Having items such as a charge off on your credit report can bring your credit score down considerably.

Therefore, if you work hard to build your credit now, it will pay you back in the end when you are ready to purchase your dream home or car.

You Can Apply for Student Loan Refinancing When the Time Comes

Later on down the road you may find that you want to apply for student loan refinancing and to do so, you need to have good credit. In fact, a financial lender will not approve your application if you have a poor credit score and a bad credit history.

Student loan refinancing is beneficial when you want a lower interest rate or lower monthly payment. If you find that you are having trouble affording your student loan payments, refinancing is an option in most cases.

How to Build Your Credit

Now that we have talked about WHY you should build your credit, you are probably wondering HOW to do it. Let’s go over some ways.

Use That Card

Above we talked about how you should use a credit card to budget for yourself. This is a great idea, but you should never just have an open account and not use it at all. To help you build your credit, take something that you do on a monthly basis and use your credit card to purchase it, then pay it off. Since you are already used to paying for this item or activity, you can use your card and then pay it off immediately without dipping into your savings account or into additional money.

Pay on Time

Always pay your bills on time. Never let one of your bills go late and if it happens to for one reason or another, pay it immediately. When you do not pay your bills, you ruin your credit score and it takes longer to build up your credit than it does to destroy it.

If you are getting ready to head off to college, it is important that you focus on building up your credit to prepare yourself for the future.

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Big Ideas for Tailgating on a College Budget


There are a lot of toys you can buy for tailgating—TVs, canopies, solar-powered generators—but it will always be at heart a blue-collar activity. The average sports fan, especially one in college, isn’t going to drop hundreds of dollars on the tailgating experience. Sometimes all we need is a place to set up shop, grill some meat, and toss around the rock. Is that so much to ask?

It is possible to have it all without busting your wallet. Before setting out on your next Saturday or Sunday morning, keep these tips in mind to craft the ultimate tailgate on a college budget.

The Grill

If there is one item where you should not skim, it’s a man’s grill. However, that doesn’t mean you need to break the bank to buy long-lasting quality either. The 18″ Weber Kettle Series is the BBQ equivalent to the American classic car. Affordable, reliable, and runs forever. Buy this grill once for $79 and it will last you a decade or more. Plus, the charcoal flavoring will surpass any propane-flamed meat from the tailgate next door.

The Food & Drinks

If tailgating is a regular affair the trips to a traditional grocery store are a waste of money. Invest in a Costco or Sam’s Club membership to buy in bulk and save money in the long run. Costco sells giant bags of frozen chicken wings (typically costing less per pound than grocery stories), buns, hamburger patties, and large cases of beer that will help you save by the end of the season.

The Games

A nice set of wooden cornhole boards can cost more than $100 (or more if you want a custom design) and every other tailgate already as them, but a ladder ball set can cost less than $20 in golf balls, rope, and PVC pipe if you’re willing to build it yourself. And, because it has the added benefit of being a less common game, you can hop around tailgates and possibly get a free beer or burger in exchange for lending out Ladder Ball for a few hours.

The Venue

Many tailgaters pay premium price for the stadium lot without question, but why? Just because you can see the stadium from your grill doesn’t make the tailgating experience any better. Merely blocks away are lots for half the price, and you can honestly find a better crowd who know how to save a buck where it counts. Next time you’re driving in for your next feast, explore around for some new lots.

“That” Friend

There’s a saying about boats: You don’t want to own one and deal with the costs and maintenance. You want the friend who owns a boat so he can invite you out on the weekend. Sometimes, tailgating is no different. There are people who buy tents, tarps, TVs, generators, and smokers that can fit a whole pig. This is the guy you want to know.

Now, that doesn’t mean you’re allowed to be cheap. Use that new Costco card to chip in on chicken wings and beer. Build that ladder ball set and bring it along. Even pack the Weber Kettle Series in case your buddy needs some extra real estate on the grill. The point is, make an effort to contribute to the party and everyone will have a good time.

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Academic Necessities Meet Student Budgets


StudentBudgetPicCollege students have to find all kinds of creative ways to stretch their budgets. Not only do they need to acquire all of the necessities to make it through another week, but they want to have just enough cash left over to actually enjoy the weekend. It can be tricky, especially if you’re in a new town with limited options. And who has time to shop around for the best price for toilet paper when you have three tests and a research paper due on Thursday? Luckily, the Internet exists to make finding a good deal easier than ever. In fact there are a lot of products that are typically cheaper when you buy them online. Here are just three necessities that students (and their parents) can purchase online to save a few precious dollars.

College Text Books

Every college student has a story about the $200 chemistry textbook they only used once and then sold back for pennies on the dollar. When you’re a new student, you can fall into the trap of thinking that your college’s bookstore is the only place you can purchase exactly the textbooks you need, but this isn’t true. Amazon has a whole section devoted to textbooks, in addition to Amazon Marketplace, where students can sell used textbooks for a slightly better price than the typical buy-back rate. It’s a win-win for buyer and seller. The one thing you need to be careful of is buying the correct edition of the book. Make sure you search by the exact ISBN number for your required textbook. If you search by title, you might end up with a very inexpensive and very worthless old edition.

Tires

Having a car on campus comes with its pluses and minuses. On one hand you have a level of freedom that isn’t available to all students. You can actually buy more than two bags of groceries at the grocery store, and you aren’t stuck waiting for the bus during a snowstorm. It’s also going to do wonders for your popularity with your carless coeds. However, owning a vehicle means you’re always susceptible to the sudden expense of maintenance. There’s nothing worse than having your car fail inspection because the tires have worn down. Just like that, a routine visit to the mechanic has turned into an $800 bill. But don’t let that red inspection sticker of doom force you into overpaying. TireBuyer.com has a full range of tires in popular brands and are priced to beat any local auto shop or big box store. It also offers free delivery, and can send your tires to a local installer. It doesn’t get much easier than that.

Contacts/ Glasses

Be warned: Your college dorm is going to eat your glasses or contacts. Between your cramped living space and your shared bathroom, it’s very likely that you will lose or accidentally destroy your glasses and contacts at least once (a semester). Just because you like and trust your eye doctor doesn’t mean you have to pay his premium price to replace this stuff. Take the time to shop around. You’ll most likely find that DiscountContactLenses.com and Warby Parker will save you a lot of money, perhaps even several hundred dollars. These companies even contact your optometrist for a copy of your prescription. Saving money on a trendy new pair of glasses means you don’t have to feel quite so bad when you step on them after a hard night of studying.

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3 Budget Tips for College Students Making Minimum Wage


CoffeeJobCollegeThe federal minimum wage hasn’t increased since July of 2009, and some would argue it has decreased. The U.S. dollar has lost about 10 percent of its buying power since 2009 due to inflation, according to the Bureau of Labor Statistics. Put another way, an item that cost $7.25 (the federal minimum wage) in 2009 would cost $8.00 today.

Granted, 21 states increased their minimum wages in 2015, but those just scraping by still must closely monitor every penny. College students are particularly vulnerable when it comes to money. A survey by public policy research firm Public Agenda found that 58 percent of college students receive no financial help from their parents. Those who said they dropped out cited financial reasons 70 percent of the time.

Parents naturally offer unconditional love and support to their future college graduates. But it’s your experience dealing with tough financial realities that can help them through the greatest and most challenging years of their lives. Here are three budget tips to pass along to them:

Be Smart About the Smartphone

A 2013 survey by the Campus Computing Project found that 79 percent of colleges use mobile apps for courses and to communicate with students. Facebook, Instagram and Snapchat are fixtures in the lives of college students today, and smartphones are now true necessities on campus. However, it’s important to weigh the options before purchasing both the hardware and the calling and data plans.

Advise your kids to look for payment plans when shopping for top-of-the-line smartphones. For instance, T-Mobile allows 24 monthly payments on a new smartphone as part of the contract. Some plans even offer a free phone on approved credit.

Alternatively, an often overlooked way to save money on cellphone service is going the prepaid route. All major carriers have flat-rate prepaid plans that require no contract. You never have to worry about overages, late fees and other extra charges. Ask a sales representative next time you’re in a retail store of a wireless provider for details on what prepaid plans they have to offer.

Care for Your Car

A 2015 study commissioned by BankRate found that only 38 percent of Americans could pay for a $500 car repair in cash right now. A broken down car can lead to missed classes, missed days of work and more stress for your already busy college kids. A large estimate or bill from a mechanic is equally stressful. The chances of either happening can be minimized with a little due diligence.

Changing your oil every 3,000 miles is simply a marketing ploy by lube shops to scare people into spending more money. Most newer cars can go upwards of 10,000 miles between oil changes, according to Edmunds. Technology of both the oil and automobiles has made the “every 3,000″ mantra obsolete. Even older vehicles utilizing synthetic oil can go upwards of 10,000 miles without oil changes as long as you swap out the filter every few months.

However, your college student needs to keep up on all routine maintenance called for in your owner’s manual, particularly transmission, radiator and air filter service. Always get two to three estimates from different mechanics before having any major repairs done because it’s the labor costs that typically swell the final bill. Check with local community colleges with auto mechanic programs because they sometimes offer repairs at much lower costs since students are performing the work.

Be Disciplined

College students must get the maximum value out of every dollar they earn. That means making a few tax adjustments. Student workers should fill out a new W4 form with their employer and claim “exempt” on Line 7. People making less than $10,500 in a given year are not required to file a tax return according to H&R Block. Thus, students who are allowing federal withholdings are simply giving the government an interest-free loan on the money they’ve earned.

A slightly larger paycheck, however, doesn’t mean they can spend more. Students should eliminate any unnecessary expenses like cable, satellite TV and Internet bills. Students typically get free Internet everywhere on campus and can stream most of their favorite shows via Hulu or Netflix. Also, they should make it a point to save 5 percent of every paycheck no matter what. Over time, this will turn into an emergency fund that can come to the rescue when emergencies pop up.

When your kids ultimately graduate from college, they will have acquired real-life financial lessons to help them transform into successful young adults.

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Money Matters: Transition from College Life to the Real World


piggybanksavingsGraduating college is an important milestone in a person’s life. But once the celebration is over, you’re faced with real-world responsibilities. If you haven’t already been paying all your own bills, figuring out your personal finances is top priority. Whether you are considering graduate school or working full time, the decisions you make about money will influence your future. Handle money matters with a plan and a budget.

Make a Budget

Make a budget of your incoming cash flow and your liabilities, so you know exactly where you’re at before you pay bills. Invest in budgeting software or find a resource online to help you keep track of your expenses. Determine how much you have between paychecks so you can set accurate limits on your spending. Consider an app like Mint.

Determine the True Cost of Living

In college you might have lived in a dorm or with your parents, so you avoided paying for housing. Research the true cost of living on your own. You must ask the following questions:

  • What is the cost of groceries in your neighborhood? Determine if the area is flooded with gourmet grocery shopping at places like Whole Foods or if there is a Walmart or equivalent available for basic needs
  • What is the cost of basic services in your area? It is a prudent exercise to learn how much dry cleaning, a trip to the doctor’s office and a haircut costs in your area
  • Get a realistic assessment on car insurance rates and gas based on the neighborhood you choose. Auto insurance varies based on zip codes. Plugging in your zip with the online calculator on insurance quotes will give you an idea of rates in your area.

You may be eager to move out of your parent’s home, but the truth is, not having to pay for rent right after college is a great opportunity to save money. You don’t have to rush into another property that’s less than optimal. Put some savings aside and take your time deciding where you want to settle.

Live Below Your Means

The independence of the real world can offer tempting luxuries, but resist spending money on things you don’t really need or want. Even if you have some debt, try to save part of your salary in a savings account or in investments. The long-term benefits of saving earlier rather than later isn’t always clear in your 20s, but will definitely be a wise move as you age. If you have a 401k available through work, take advantage of your ability to contribute to it.

Charging items to a credit card is convenient, but do not get caught up in the allure of plastic. The next thing you know, you have several cards with balances and a high interest rate. Revolving credit means accumulating debt. Make it a policy to use your credit card sparingly.

Start an Emergency Fund

Put away small amounts of cash every month. This will come in handy in case an emergency arises. A car repair, unexpected housing cost or even something bigger can set you back if you exclusively rely on your regular salary. An emergency fund might save you when you need it the most. If you’re not good at putting aside money, set it on auto. Enroll in a program like Bank of America’s Keep the Change, which helps you incur savings with every purchase you make.

The transition between graduating college and the real world is exciting, but also carries new responsibilities. Be smart with your money and make wise decisions to invest in your personal and financial health.

 

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4 Tips For Living on a College Budget


student-budgetBeing a student will be one of the most rewarding things you’ll do in your life, but it will also be one of the most challenging, especially financially. Unless you have someone paying for your studies and living expenses, you’re going to need to be very mindful with your money. Here are some classic budgeting tips for students.

Make a budget and stick to it

It might sound kind of obvious, but to keep an eye on your money, you really need to know how much income you have versus how much you’re spending. You need to divvy up your money across all of your expenses and set limits on all of your spending categories like food, accommodation, transport, study costs, clothing and entertainment. You’ll need to monitor your spending daily and weekly to make sure you’re sticking to your budget. If necessary, adjust your spending limits across different categories if you find yourself spending more in one but less in another.

Support your study and social life with a job

The Internet offers many flexible ways to generate a bit of money on the side. Take a look at e-freelance sites such as ODesk and Freelancer. If you’re a programmer or writer, you can pick up small or large jobs fairly quickly. There are also plenty of casual jobs in retail and hospitality, so search through job sites and even print your resume off and drop it at local businesses.

Luckily, there are many ways to achieve your academic goals nowadays. Organizations such as Careers Australia provide students with flexible study options, including attending courses at night or completing study online. Determine what sort of work will best complement your study schedule and ensure you don’t overextend yourself.

If it’s not free, don’t go

Going out and socializing is important, as you need to take a break from study and relax and unwind. However, over-spending on your entertainment is one of the easiest ways to blow your budget. Let’s take a look at some alternatives to the big entertainment budget blowers:

  • Put a ban on the pub for a bit and head over to friends’ places or invite people over to your home for drinks
  • Don’t eat out unless you’re having dinner at a someone’s home or you’ve got a ‘2-for-1’ meal deal at a cheap restaurant
  • Check out events mags for free events and shows rather than buying tickets to expensive concerts

Don’t be a fashion victim

When you’re a student, you have to make sacrifices and spending money on outrageously priced fashion labels should be the first item on your budget hit list. You can get the look for less – you just have to be smart about it. Only buy items on sale, check out discount outlets, swap and borrow stuff and hit the charity shops.

As a student, you have to be really tight with your money. It might be painful and feel like poverty, but bear in mind, it’s not forever. Come back to the reasons why you’re studying and think about where your education will take you. Learning to budget and being sensible with money is a critical life skill that we all need, so take the opportunity to become the master of your own finances.

Do you have any budgeting tips to add to this list? Share your thoughts below.

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Valentine’s Day in College: Save Here and Spend There


A poll conducted last month by Prosper Insights and Analytics found that, of the 6,375 consumers surveyed, 91 percent will do something special for their significant other this Valentine’s Day and, due to the holiday’s high price tag, 35.2 percent plan to shop at discount stores for gifts.

These results shine light on the trend of carefully budgeting for a Valentine’s Day gift without skipping it altogether, especially for college students who are already on tight budgets. Luckily, there are fun and unique ways to surprise your sweetheart that won’t skimp on the romance or put a huge dent in your bank account.

Create an experience

Expressing your love takes more than just going to dinner and a movie. This year, skip splurging on the overpriced prix fixe meal and, instead, cook a fancy dinner at home. If you live in a dorm, ask your roommate for a few hours of privacy so you and your Valentine can cook and canoodle without an audience.

If you’re more outdoorsy, go on a picnic hike to a picturesque overlook. Stash away a handwritten card or small gift beforehand to surprise him or her with words of endearment

Look for unique discounts

Valentine’s Day specials at local retailers aren’t always easy to come by, but with ingenuity and sleuthing, you can make it work. Look for online discounts for restaurants, gifts, guest passes to a local Botanical Gardens or museum. Find out if there are any nearby art shows or gallery openings that weekend, as those types of events usually offer free wine and hors d’oeuvres, making for a classy evening out.

Spend where it matters

Budgeting for Valentine’s Day is about knowing how to create a memorable experience with or without money. Spend your money where it matters most rather than splurging on an expensive, impersonal gift. An online gift retailer likely has promotions running for Valentine’s Day. For her, save for a gorgeous bouquet of flowers; for him, order a gift basket of assorted gourmet nuts or a meat and cheese crate.

Don’t want to go the food or flowers route? Splurge on a day trip to the mountains or a limo ride through the city.

Enjoy time together

As college students, you spend a lot of time in class and when you’re not in class, you spend a lot of time studying. Instead of spending money on stuff, spend quality time together on the Day of Love. Take a moonlight walk, then head home to queue up some free streaming movies, play a board game, indulge in a delectable dessert or invite a few friends over for a budget-friendly potluck. Make your evening about being with the people you care about most and take the price tag off Valentine’s Day this year.

Fulfill their heart’s desire

You may not be able to afford a new car, fancy jewelry or dinner at a five-star restaurant, but maybe all he really wants is you to finally join him rock climbing at a local gym. She might be dreaming about a flying lesson and you remember her mentioning a place that offers introductory lessons for less than $100. Or maybe it’s as simple as wanting to paint the bathroom, but lacking the motivation to do it; so YOU do it. Basically, if you make an “I wish I could…” moment come true, it will be a Valentine’s Day to remember.

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Semester Sequester: 3 Tips To Stretch Your Dollars


Nearly 80 percent of college students are employed part-time, working at least 19 hours per week, according to a 2013 survey conducted by Seventeen magazine and Citigroup. And it looks like most parents are no longer giving their kids a free ride to college; only 22 percent footed the entire bill that year.

Workers age 16-24 represent the highest proportion of minimum wage employees in the United States, Pew Research reports. That means most working college students are making less than $500 per month after taxes to cover their entertainment, late night meals and other expenses—including books and tuition for some. When money is this tight, you’ll need to be both disciplined and cautious when it comes to your social life. These three tips will help:

Use a Budget App

The 2014 Consumer Financial Literacy Survey by Harris Interactive and the National Foundation for Credit Counseling found that 61 percent of American adults do not use a budget. It’s safe to assume college students help boost that number.

Mint.com is one of the most popular and easy-to-use personal finance apps available. It syncs all of your bank and credit card accounts and tracks all expenditures. Mint organizes spending in categories such as entertainment, transportation and groceries. It then paints an intuitive picture of your financial situation today and in the long run based on spending practices. You’ll see where money is being wasted and how you can free up more funds by eliminating bad habits. Mint is free and compatible with both Android and iOS devices.

Moneywiz and HomeBudget are two other options, although they aren’t free—they cost $4.99 each.

Make Use of Student Discounts

Business owners build their companies near college campuses because of the guarantee of loose-pocketed customers eight months out of the year. Many students fail to realize their college IDs are like perpetual discount cards that are good at most of these establishments.

Buffalo Wild Wings, Chick-fil-A and Chipotle restaurants offer 10 percent discounts with a student ID. The discounts vary by location however. For instance, the Buffalo Wild Wings in Grand Forks, North Dakota, offers a 50 percent discount on Sunday nights to college students, and the AMC theaters have a Student Day promotion which offers discounted tickets on Thursday nights. Banana Republic, J. Crew and The Limited all offer 15 percent discounts to students.

Make sure you know what discounts are available in your city.

Get Creative

Let’s face it: Car trouble, medical emergencies and other unforeseen events happen, and they can throw your budget completely off. At times like this, you’ll have to figure ways to come up with emergency cash.

Many college financial aid offices have emergency short-term loan programs. Stop in and speak to a counselor about all available options. Students receiving monthly stipends from annuities or structured settlements should consider selling their future payments for a lump of cash upfront. The Dreamkeepers program by Scholarship America offers emergency college funds for students experiencing financial hardship during the semester.

College years are supposed to be memorable, educational and eventful all at the same time. Don’t let financial irresponsibility derail those goals.

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