Money tips every college student should know

Jeanette A. Tucker  |  7/11/2008 1:02:15 AM

Back-to-School News Distributed 07/11/08

The emotional days of watching your young child board the big yellow school bus for the first day of school may be long gone, but now you’re watching your young adult embark on an even bigger adventure – going to college.

“College is a completely different existence from what your child has known,” said LSU AgCenter family economist Dr. Jeanette Tucker. She explains that at college, no one tells students what to do or when to do it.

“This is the first time many kids live on their own, and it is when they begin to develop their own personal and financial independence,” Tucker said.

The family economist recommends parents and students alike read “40 Money Management Tips Every College Freshman Should Know” (www.smartaboutmoney.org/nefe/uploadfiles/40moneytips07.pdf) by the National Endowment for Financial Education. She highlights some NESE advice.

– College freshmen should talk to their parents. It’s important to know what their parents expect from them financially and what they can expect from their parents.

– Once settled into their dorm or apartment, students should get all their important financial files, like receipts, warranties, financial aid and college documents, checking account statements and bill payments organized into a file box that locks and keep the box in a safe space.

– Keep applying for financial aid. Scholarships, grants and awards aren’t just for incoming freshmen – students can apply year after year. Not only should students meet with an adviser or financial aid officer, they also can visit several Web sites.

Recommended Web sites include: College Board at www.collegeboard.com; Fast Web, a financial aid search engine at www.fastweb.com; National Association of Student Financial Aid Administrators at www.finaid.org; Sallie Mae scholarship service at www.salliemae.com; and the U.S. Department of Education at www.ed.gov/about/offices/list/ope.

“Don’t forget to pay attention to deadlines!” Tucker says, explaining, “That’s a common mistake students make when applying for scholarships.” And remember that federal financial aid does not continue automatically from year to year.

Another NESE tip reminds students to file a Free Application for Federal Student Aid (FAFSA) each year as soon as possible after January 1. File online at www.fafsa.ed.gov.

“A budget is one of the best tools you can employ when keeping track of your money,” Tucker said. She suggests using a budget, or spending plan, as a financial map. It tells you how much is coming in each month, where you have to spend it and where you may be able to save.

“One huge issue with college students is credit cards,” Tucker said, explaining, “Some 83 percent of college students have at least one credit card, and 55 percent of those with cards received them their first year as a freshman.” One study showed that more students were quit school because of credit card debt than academic failure.

Another NESE tip suggests that if a credit card is necessary, keep only one major card. Shop around for a card with no annual fee, and be sure to find the lowest interest rate. Don’t charge anything that you can’t pay for at the time, unless it’s an emergency. After the transaction, subtract the credit purchase from your checking account so you’ll have enough money to pay the bill.

NESE also advises that the best way to save money is to remember to “pay yourself first.” This means putting money in your savings account before you spend it on other things. This is good motivation to save if you have a specific goal.

“When you know how to manage your money, you will be better prepared to successfully meet your goals – and to have enough money to make them a reality,” Tucker says. “Students who learn how to take control of their money will not let their money take control of them.”

For related family economics and consumer topics, click on the Family and Home link on the LSU AgCenter home page at www.lsuagcenter.com. For local information and educational programs, contact an extension agent in your parish LSU AgCenter office.

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On the Internet: LSU AgCenter: www.lsuagcenter.com
Contact: Jeanette Tucker at (225) 578-5398 or jtucker@agcenter.lsu.edu
Editor: Mark Claesgens at (225) 578-2939 or mclaesgens@agcenter.lsu.edu

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