Freedom. After leaving the confines of your parents’ house, you finally can do what you want, when you want and spend what you want — or can you?
Some students wonder what to do when they finally get on their own and realize what things cost, but here are a few tips to avoid being in the poorhouse (or wearing smelly clothes and starving).
I have realized the benefits of careful spending from personal experience and observation.
Budgeting is essential to independent living, but of course, that is easier said than done. It may take a few months to realize how much those midnight pizza deliveries cost you, but knowing where and how you spend your money can save big bucks in the long run.
First, make a list of all expenses for the semester and all potential income and savings. This may take some researching your old credit card statements, grocery bills, car repairs and maintenance and entertainment bills. Be realistic and record everything. This will give you a sense of your cash flow.
Once you reach an estimate, compare the numbers to your financial statements by adding your work income, loans and scholarship money to get an idea how much money comes in each semester. Then figure out the change in your bank account, keeping credit cards in consideration, to see what you can afford.
Now that you know what you have to work with, prioritize living expenses and necessities. You will need to pay rent, electricity, food and school supplies. While these items are essential, you can find ways to reduce these bills to leave more spending money.
Groceries can be expensive or inexpensive depending on consumption habits. One way to cut the bill is to compare prices and check sale advertisements. This will help you recognize good deals. Also, learn how much you use of certain items, how long they take to perish and how long it takes you to use each item.
For example, buying the large bag of chips may not be the best deal if the chips go stale before you eat them. Also be careful when buying perishable items such as milk, bread, fresh fruits and vegetables. Sharing items with a roommate or buying smaller sizes may be less expensive.
Also consider commodity items, such as bottled water, instant foods and name brands. Prioritize important items and go cheap on the others.
When it comes to laundry, you have several options. Identifying your needs may be able to save you money and time. If you tend to have several small loads of laundry, you may want to share laundry with a friend. Sometimes you can mix loads in commercial dryers, which usually are larger than the washers.
If you have a friend or relative with laundry machines, ask if you can pay them for year-long laundering privileges.
You also can budget for laundry by converting a few dollars to quarters at the beginning of the year and setting them aside for laundry use only. This way you always can have clean clothes.