Manage Your Finances

How College Students Can Take Control of Their Finances Amongst the Chaos

College is all about learning, meeting new people, and finding a career path that will lead you to a life you love. It’s a great time, full of wonderful adventures, but at the back of every college student’s mind is a common anxiety: finances.

If you’re a college student who has been forced to take out a loan, you might be wondering how on earth you’re supposed to pay them back.

All this worrying about fees and costs of living is guaranteed to cause you some stress and may leave you feeling as though you have no control over the chaos of college bills. However, by taking control of your finances and planning for the future, you can alleviate some of that anxiety and put yourself in a better financial position post-graduation. 

Minimize Student Loans

Let’s start with the most obvious route to regaining control over your finances: minimizing your student loans. When you’re going out with new people, planning Spring Break trips, and generally enjoying life as a college student, your spending can easily balloon out of control.

A clear budget is like a roadmap that keeps you on course. It’s good for your wallet and your mental health, as you’ll have a clear idea of how much you’re spending every week, and won’t feel the need to check your account every time you want a coffee or when your friends invite you for a road trip. 

That budget should also help you identify places where you can cut back and make some savings. As per Mike Monfredi’s calculations, a monthly saving of $15, paid back at 7.9% interest, will save you about $873 after 4 years of enrollment — a saving well worth making. 

Credit Scores and Student Loans

Credit scores come at you fast. One day, you were enjoying canteen lunches and Friday night lights with your friends, the next you’re having to consider credit scores that can affect your ability to buy a house, car, or take out a business loan. 

But you’re not alone: 40% of American adults who have attended college used student loans to pay for their education, and they’re still able to pursue their dream careers and make major purchases by using loans and credit. 

Your credit score is calculated based on your payment history and the amount of debt you owe. So, if you’re able to pay off a higher percentage of your loan sooner, then your credit score will be higher (and vice versa). Paying off your student loan can actually be a good thing for you, as it will help you build credit which improves your credit rating. You can also find some flexible repayment options and may be able to enroll in rehabilitation programs if you default on a federal student loan. 

Becoming Financially Competent 

For most students, college life is the first time you have to deal with “adult” financial terms and ideas. It’s easy to bury your head in the sand and ignore finances — especially when you’re already behind in Calculus and have an early morning  Art History class three times a week. But, becoming financially competent is vital if you ever want to regain a sense of control. 

As a college student, you need to learn about things like 401(k)s and how to properly maintain an emergency fund. Becoming financially competent isn’t going to happen overnight, but you can treat your financial literacy as a single credit elective — just an hour of reading and researching per week can give you the skills and financial knowledge you need to gain financial freedom and success.

Investments for Students

Most students don’t realize that they are even allowed to invest their money, and many young folks make the mistake of believing that they need thousands of dollars to start investing. The reality is that investing is all about planning and using what you do have to make a brighter financial future. 

Start small, and only invest what you can afford to lose. Even a small amount is a great start, as you’ll gain practice and your safe investment will, hopefully, mature over time. Of course, you should not invest the money you need to live on and should have a healthy emergency fund built up before you start buying stocks, shares, or cryptocurrency. 

If you just want to get started, the easiest method is to start with investment apps like Robinhood, Acorn, and Stash. These apps have caught a fair bit of negative press recently, sometimes for good reason, but they do simplify the process and make it easier for you to start investing your wealth. 

Savings and Future Plans

Opening a savings account is one of the best things you can do as a student who is struggling to save. Most savings accounts have minimum deposits required to open them but are generally accessible for short-term needs just like a checking account. The big differences: you may earn interest, and can’t spend directly from the savings account. 

Having a savings account helps you see how much you’ve saved, and can help you build an emergency fund. These emergency funds should generally cover around 3 months’ worth of expenses. So, if your cost of living is $1000, you should aim to have roughly $3,000 saved up in an emergency savings fund. 

You can also start taking care of future worries while in college. Even if you have minimal assets and a modest bank balance, it’s never too early to write a digital will. A digital will allows your family to close down your accounts if something happens to you and gives you peace of mind concerning what will happen to your loans, investments, and finances in the future. 


College is a stressful time for many folks. You’re constantly dealing with competing deadlines, are meeting new people, and are being exposed to new and engaging ideas every day. On top of that, financial stress can be overwhelming and can negatively impact your ability to learn. 

Take control of your finances by treating financial literacy with the respect it deserves. Read up on blog sites hosted by Camp Fire Finance, and start your first steps into investing and saving. Even a small effort now can lead to major rewards in a few years. 

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