When you’re in college, it can be easy to overlook the financial aspects. But as a young adult that is just starting out in the real world, it’s vital to know that certain choices will help to build a financial foundation for several years to come. A couple financial blunders in your late teens or early 20’s can still follow you for years after graduation, so try to avoid the following financial mistakes that college students frequently make:
Not following a budget
With a lack of income combined with the high cost of college tuition, it’s especially important for students to make a budget and commit to it. Overspending, not saving, and failing to financially plan properly can result in overuse of credit cards and loans.
Not applying for financial aid and/or scholarships
Scholarship money and financial aid doesn’t need to be paid back—unlike a loan. Alas, many students don’t take advantage of this potential opportunity, and they may be passing up on the chance to receive free money to fund their education. Many people have the mindset that it’s just easier to borrow the money with a student loan, so many college students will just do this instead of looking at their other options, such as scholarships and financial aid. Others often think that they aren’t eligible, so they don’t bother applying. But with all the different types of financial aid and scholarships available, you never know what you may be eligible for if you don’t ever give it a shot.
Being in college for too long
Going to graduate school is a terrific way to further your education, and it can also mean more opportunities—but it doesn’t automatically mean being more successful. You might end up with the same job, at the same pay, after you receive a master’s degree then if you just got a job after graduating with a four-year degree. Wisely consider your career goals and the need for a professional or graduate degree, and don’t just assume that a master’s degree will automatically equate to higher earnings.
Attending a costly college
Does the name of the school on the degree really make a difference? Definitely, in some cases—whereas in others, not so much. Many students strive to attend a prestigious out-of-state school or Ivy League college, but financially, it may not be the best option. One idea to consider is attending an inexpensive school (such as community college) initially, and then transferring to a four-year university to finish your education and graduate. This is an option that can give you the chance to save up more, and without getting into much debt.
Borrowing too much
For many students, loans are the only way to pay for college expenses. The issue is that some students will borrow the entire amount they are offered, even if it is way more than what they actually need. In order to avoid being in a substantial amount of debt after graduating, only borrow what you truly need for college expenses.
Getting into credit card debt
Students with few financial resources are likely to apply for their first credit card during their college years and charge way more than they should. Avoid using credit cards completely, if possible. If you definitely need to use a credit card, be sensible and pay off all or a majority of what you charge each month. The last thing you want as a college student is to already have a ton of credit card debt—especially if you also borrowed money through student loans.
lf you need money to pay for college, Peachtree Financial Solutions may be able to help. Peachtree can buy some or all of your future structured settlement payments and offer you that money sooner in a lump sum payment. You may be able to use that cash to take care of college expenses. Contact Peachtree Financial Solutions today to learn more and to receive your free quote!
Nothing above is meant to provide financial, legal, or tax advice. You should meet with appropriate professionals for such services.