Common cents

Between all the classes and social events, students are constantly trying to keep their heads financially above water. Learning to budget money as a student can be a hard lesson, but it can lead to a road of fiscal responsibility.

All the financial responsibilities thrown a student’s way can be overwhelming, but there are a few ways to keep from constantly worrying about money.

First, students should learn to track their spending. Often times, students will use their debit card without knowing how much money is left in their checking account, which can lead to overdraft fees. This is one of the biggest problems according to Linda Bell, a customer service representative at Exchange Bank, located at 250 W. Hancock St. in Milledgeville.

Before buying something, students should make sure their other monthly expenses, such as rent and utilities, are paid for.

Credit cards can be troublesome if overused because they leave a financial trail for years to come.

“Even though you might not write checks, you still need to keep a register of where you’ve spent the money at and keep a running total of what you have,” Bell said.

Before buying something, students should make sure their other monthly expenses, such as rent and utilities, are paid for.

“I’m a firm believer that credit cards will get you in lots of trouble,” Bell said. “They’ll follow you for many years down the road.”

For those that choose to use credit cards, Bell recommends only spending as much as can be paid off the next billing cycle and to have a job, if that’s what it takes to keep out of debt.

However Dr. Tom Moore, a professor of business law, believes students should work less outside of school because there is plenty of time to work once you graduate. If students need a job to help pay for school, Moore suggests taking out a student loan instead of working in addition to a full class load.

“You get to pay (student loans) back over the course of your life, and that way you get to immerse yourself into your education and what college really is,” Moore said.

While Moore maintains that students don’t have to spend a lot of money while out socially to have a great time, any money spent hanging out with friends is “worth every dime.”

According to Moore the biggest mistake a student can make financially is to make a big purchase that can bring fixed payments, such as buying a new car.

“I tell my tax class, just drive an old car as long as you can until the wheels fall off,” Moore said.

When a normal payment is made, students can make up for that expense by cutting back, such as eating at home for a week, but that is harder to do with fixed payments.

“I don’t think it’s a question of saving a lot of money,” Moore said. “I think it’s a question of buying your time, and I think you can typically do that better by not having a lot of payments.”

Students not only need to be aware of their own spending, but also any unusual purchases that may appear on their statements because of financial fraud.

According to Spendonlife.com, almost 10 million people were victims of identity theft in 2008, with 43 percent being either due to credit card or bank fraud.

One recent development in credit card fraud has involved restaurants, where workers have taken pictures of their customer’s card with a small camera or smartphone, Bell said.

While this can be hard to prevent, Bell advises students to monitor their accounts using online banking in order to catch any odd expenses. Students should also be wary of leaving their debit or credit card at a bar because it can often disappear and should never give out a bank account or Social Security number unless it is to a trustful source and the reason is known.

Moore said that once students graduate and get a job, “the most important thing for a young person to do is to start saving fast” through an employer’s 401(k) or Individual Retirement Account plan because “to get rich you don’t make a lot of money, you control your costs.”

“Get in the habit of living within your means and saving a little money every month and you’ll retire a wealthy person,” Moore said. “Life’s a habit.”

Posted by Allison Bramlett on Feb 12 2010. Filed under Focus On. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry