Building Good Money Habits Early: A Guide for Students
Introduction
Learning how to handle money as a student is like learning to cook - mess it up early, and you might be stuck eating instant noodles for life. Many of us (myself included) have had those "where did all my money go?" moments. But let’s be real, most student money struggles come from not knowing the basics of budgeting, saving, and spending wisely. The good news? A few small money habits now can save you from future financial headaches (and from trying to stretch out your final 2 instant noodle packets for the next 4 days). Here’s how you can start building solid financial habits while still in school or university.
Create a Budget and Stick to It
As an accounting student, I learned the basics of a simple cash flow statement — basically, tracking what money comes in and what money goes out. In layman’s terms, that means knowing where your cash is coming from (like pocket money, part-time job wages, or a student allowance) and where it’s disappearing to (rent, groceries, or that suspiciously high “entertainment” category).
Creating a simple budget isn’t just about crunching numbers; it also helps you to stay on top of your expenses, dodge any unnecessary debt, and save for big goals (yes, that Euro-summer you’re dreaming of could be more than just a Pinterest board)! Here are the key things to keep in mind when setting up your budget:
List all sources of income (whether it’s regular or irregular).
Track all your expenses and categorise them as needs (rent, food, transport, etc) and wants (entertainment, shopping, dining out, etc).
Allocate a portion of your income for savings.
Monitor your expenses every payday and adjust them based on your priorities.
Creating a budget is much easier than you think and does not require an accounting or finance degree. You can start with a simple spreadsheet template or use budgeting apps like MyBudgetPal or Splitwise to keep things organised. The real challenge? Sticking to your budget. It might feel tedious at first, but trust me, it gets easier the more you do it. I highly recommend setting a reminder on your phone or calendar to update your budget every payday, because let’s be honest, if it’s not scheduled, it’s probably not happening.
Develop a Savings Habit
Saving money, even just a little, is one of the best financial habits you can develop. I still remember my first taste of earning money back in intermediate school when I had a paper run job. My parents encouraged me to set aside a small portion of my wages into a savings account, and surprisingly, that advice stuck. Fast forward to today, while my salary (thankfully) isn’t paper run level anymore, I still make it a point to save a portion of my income every fortnight.
I’ll be honest, I don’t have a specific savings goal right now. But because I’ve made it a habit, it’s second nature every time I update my budget. These savings act as my emergency fund, ready to cover any unexpected costs life throws at me. I highly recommend getting into the habit of setting aside a bit of money every payday, whether you have a goal in mind or not. A little can go a long way, and future you will thank you for it!
Conclusion
By developing good money habits as early as now, you lay the groundwork for a financially secure future for yourself. By budgeting frequently, managing your spending wisely, and saving consistently, you can build a solid financial foundation that can help you in the long run. The earlier you start and develop these habits, the easier it becomes to handle your finances like a pro when adulthood (and all its expenses) hits. Think of financial literacy as an investment for yourself, where the rewards last a lifetime!
Opinion by Andre Bonilla