Budgeting Your Expenses

Budgeting does not have to be painful. Think of budgeting as good planning. Do it right, and you'll be able to focus on what's most important to you - reaching your educational goals.

National consumer debt is climbing, and it's a fact that most of us need a budget. A good budget is simply a guideline that can help you spend your money on the things that really matter, or that you really want.

Here are five suggestions that can help you create and stick to a budget:

1. Get motivated and think about how hard you work to pay for your education. Most loan programs have repayment terms of 10 years or less. Wouldn't you like to know you can manage your loan repayments now, and not be overwhelmed when you graduate?

2. Track your spending. Financial planners say that you must first examine your current spending habits. Record your spending for two weeks or a month. Then, organize your spending into categories that make sense to you like books, food, clothing, entertainment, car insurance, and the like. Two main categories could be income and expenses. The income category could itemize your grants, scholarships, work-study or other pay check(s), student loans and other income. The expense category could itemize your registration fees, books and supplies, rent, utilities, phone, meal plans, car expenses, clothing, personal care items, credit card payments and miscellaneous items.

   If you have access to a computer, make a spreadsheet of your spending habits, or purchase a software product for this purpose. If you need help, visit your local library and read up on the topic of financial planning and making a budget.

3. Analyze your spending and you will soon discover which activities claim most of your income and may be doing real damage to your pocketbook.

4. Set goals and adopt new or more reasonable spending habits. Here are some simple ways to save money: carry a brown bag lunch, walk or carpool to campus, buy a thermos for your morning beverage, or, if you live off campus, develop thrifty habits with utilities like gas, phone, electricity, etc., and don't use your credit cards unless you must; you may want to think twice or three times before you use them!

5. Monitor your progress at the end of each month. Remember to stay flexible, and once you find a comfortable budget, stick with it. But if you didn't make your goal last month, try again this month and keep working at it until you see the desired results.

Budgeting for Student Loans

Depending on the types of loans that you have, you may need to work a loan repayment into your current month's budget, but certainly this will need to be considered in your future budget. We have found several links to web pages with calculators that can help you estimate what your loan payments might look like after graduation. We don't recommend one over the other, but you might find any one of them to be a helpful planning tool.

Give some thought to the amount of income you will need to cover your future budget, including the repayment of your loans. Will a job in your chosen field provide you with the income necessary to meet your financial needs? Considering these aspects of your future economic picture may help you to make sound decisions about your educational options and obligations while you are still in school.