Balancing the Budget
If you are a parent and/or are married, don't forget to adjust the amounts you find below to include your spouse's income, expenses, child support, and other associated costs and income sources.
If your expenses match your income - or if your income is greater than your expenses - that's great! You'll have to do very little fandangling. However, this isn't always possible. More likely than not, your expense list will exceed your income list. You have a few options when this happens:
- Cut your expense budget down to the bare bones. As you go through, ask yourself "Do I really need to spend $120 on a pair of jeans?," "Do I need to see three concerts a year?," etc. Be critical of each of your numbers!
- Increase your income. Apply for more scholarships and grants - that's money you don't have to pay back. Apply for a part-time job. Sometimes universities offer work-study funds as part of your scholarship. Take full advantage of these. Come up with an entrepreneurial venture.
- Ask your parents if they can help more. Don't count on this. You should only take this measure if you find that even with a job and cutting back expenses to the bare minimum will still not cancel out your expenses.
When looking at your budget, your income and expenses need to match exactly. When you subtract expenses from incomes, the figure should be $0. If you have more income than expenses, budget that excess as savings and emergency fund money. Don't add to your already-budgeted for categories. You never know when you might need an extra thousand bucks for a dental emergency or car breakdown.
You should, at all costs, no matter how savory and seductive the companies make themselves, avoid getting a credit card. This will only add to your bills each year. If you think you need a credit card - which in essence is a short-term, very expensive, loan - you're spending too much money. Additionally, when it comes to student loans, only borrow the minimum amount necessary. Many new graduates have a horrible awakening when they're job-searching and their loans come due. Save yourself the heartache of having $100,000 in debt when you graduate if you can at all do so.
Plan out your budget for each of your years in college. Remember the average student takes between four and six years to graduate. Add up the total cost and the total income. Add up the total loans for that period of time that will accrue. If your loans exceed the income you expect to make in your first year of employment, you might want to reconsider whether right now is the time to go to school. That's a harsh, but necessary, reality to face sometimes. Can you go to a community college for two years to shave off some of your costs on general education courses? That's an excellent option for students who are unsure about what they will major in - and it can save a good deal of money.