Question: How can students save money and budget effectively while in school?
Answer: Becky Knickel, accounting faculty: I am a huge believer in saving money. I would advise anyone – students and employees – to carefully examine how they spend their available money. If they can do with less than they make, they should save it. Save first by having the bank transfer a set amount into savings from each paycheck.
Debt is an issue students must manage carefully, whether it is a car payment, a student loan or credit card debt. Paying off credit card debt should be a top priority.
If credit cards are not paid off monthly, they may charge more or less than 23.8 percent interest. Always pay off credit card debt as quickly as possible, and never borrow more than absolutely needed.
Saving money involves spending less and often spending smarter. Students can cook at home and spend less on take-out food and Starbucks coffee. They can plan ahead to compare prices. Only buy what is needed at the grocery store and make a list.
I teach an accounting capstone class. My students offer the following suggestions:
•Comparison shop. Compare by looking at unit price and location.
• Cook at home and use the food you have in the refrigerator instead of eating out.
• Avoid credit card debt that is not paid off monthly.
• Make a budget and stick to it.
• Figure out what you can save and have it taken out of your paycheck first.
The American Institute of Certified Public Accountants and the Texas Society of CPAs have valuable information on their websites: www.aicpa.org and www.tscpa.org.
I believe it is important for each of us to be financially responsible. If we spend now, we are really stealing from our future.
It is hard while still in classes to think about retirement, but the dollars that you save today might allow you to retire when you are ready.