Jeanette A. Tucker | 7/15/2005 3:19:41 AM
Moving away from home for the first time is a pivotal moment in life. It is one of the rites of passage from youth to adulthood, according to LSU AgCenter family economist Dr. Jeanette Tucker.
Whether your first place is a room in a dorm, fraternity, sorority or an apartment with others, it is still your own. You can decorate it how you please, invite over whomever you want and stock your refrigerator anyway you wish. It is up to you.
Independent spending decisions quickly become an everyday occurrence for college students, but they also involve an incredible amount of financial freedom that most young adults are not prepared to handle, the family economist explains.
"Living at home usually meant that parents paid for most living expenses," Tucker says, but adds, "It is a rude awakening when bills start arriving in the mail once you are on your own." Phone and utility bills, car payments and credit card bills are just some of the new arrivals that college students may find in their mailboxes.
Tucker says it is a good idea to prepare a budget before moving out if you can anticipate your expenses. If it is impossible to prepare a budget in advance, she says it should be done as soon as you begin living independently.
How? The economist says to begin by estimating your monthly income from all sources (jobs, student loans, scholarships, parent allowances and gifts). This total should be the amount of money left over after you have paid your tuition expenses. Then determine how much you will be able to spend for each of these budget categories: housing, food, clothing, health, transportation, apartment purchases, savings and miscellaneous.
To simplify this step, multiply your total income by the following percentages, which represent the average expenditures by college students: housing, 31 percent; food, 16 percent; clothing, 6 percent; health, 5 percent; transportation, 20 percent; apartment purchases, 7 percent; savings,7 percent; miscellaneous, 8 percent.
Your total expenses should be equal to or less than your net income. By knowing what your expenses are and the income you have available, you will be more likely to live within your means.
Tucker also says to keep in mind that you will experience many first-time move-in costs. Some of these costs will not apply if you live in a dorm or a fraternity/sorority house. But if you choose an apartment or house, numerous up-front costs will need to be paid. Some of the most common up-front costs include the first and last month’s rent on the apartment, fees for cable, Internet service and apartment application and deposits for apartment, pets, electricity, gas and telephone.
In addition to up-front costs, you will need to come up with the money for furniture, appliances, utensils and other housewares if your new residence is unfurnished. Sleeping on the floor gets old and painful quickly!
Of course, the cost of furnishing your new place can be dramatically reduced by accepting donated furniture from your relatives or by shopping garage sales and thrift shops.
"The reality today is that most young people want their place to be furnished just as nicely as the home they just moved from, complete with computer, entertainment center and all the amenities," Tucker says, noting, "These items cost money, and more often than not, will be paid for with borrowed funds." She says although paying with credit seems easier than paying with cash, it can be much more costly in the long run.
For information on related family and consumer topics, click on the Family and Home link on the LSU AgCenter homepage, at www.lsuagcenter.com. For local information and educational programs, contact an Extension agent in your parish LSU AgCenter office.