Higher education has its benefits, both financial and not. A bachelor’s degree helps ensure lifetime earnings will be greater than someone with just a high school diploma. Aside from the financial benefit, the cognitive skills used in tackling tough academics are useful inside and outside of a career.

Nevertheless, college students often start careers at a financial disadvantage. All that is involved with academics — going to classes, studying, researching, and perhaps being an unpaid intern in the field of study — take away from precious time that could be spent earning money. Besides missed earnings, it’s common to start a career out of college with tens or hundreds of thousands of dollars of debt.

It helps to start thinking about personal finance while in college. I didn’t. After college, it took a few years of working for low pay at a non-profit organization to realize I wasn’t making any progress. It would have been decades before I’d be able to afford to buy a house, for example. I worked during some of my breaks from college, but I can’t say with any certainty what happened to that income.

The best thing one can do is attend a college where costs are low and receive as many scholarships as possible to cover tuition costs. With state budgets in crisis, many colleges will have to increase the cost of attending — perhaps bigger increases than families have been accustomed to. Here are some ideas for saving money in college, partially negating the effect of graduating with crippling debt.

1. Open the right bank accounts. Making better choices when dealing with banks won’t make you rich, particularly in today’s interest rate environment. No college student should leave home without a high-yield online savings account and a free student checking account. A student’s best bet is to have a checking account at a bank that offers convenient branches both in the parents’ town and near campus. This allows parents to deposit checks easily if necessary while students can withdraw funds as needed without a hassle. With a job on campus, income can be automatically deposited. Many banks offer student accounts with no fees and no minimum balances.

2. Avoid the campus bookstore for text books. The text book industry is a bit of a racket. Schools encourage professors to require the latest edition of text books, and some text books release a new edition every year. Most of the information inside doesn’t change however, so you may be able to succeed in the class with an older version of the text. This opens you up to buying used text books, borrowing text books from friends or strangers who took the course previously, and swapping text books online. Not only that, but when you own text books and are finished with the course, you have opportunities to sell the text books to other students through popular avenues like Amazon.com.

3. Open the right credit card. Credit cards can be dangerous tools, especially in the hands of a young adult with little experience with spending. If an emergency arises while a student is away from home, having the right credit card and the right approach can be the difference between paying the minimum to resolve the issue and falling deep into a cycle of debt. When I was a freshman in college, during orientation my classmates and I were bombarded by salespeople tempting us with free gifts (tee-shirts, Frisbees, etc.) to encourage us to sign up for credit card offers. I would imagine most do not stop to read the terms and conditions of these offers, and those who do may not have a good comparison tool. Find which best student credit cards don’t charge fees.

4. Take advantage of the dining plan. When a student lives on campus, schools often require her to pay for a dining plan. Dining plans help to make sure students eat relatively healthy foods consistently — though this approach isn’t completely effective. Nonetheless, dining plans are often included in tuition bills, separating the concept of eating from paying to eat. It’s easy in this situation to forget that you’ve pre-paid for a certain number of meals per week, and with many meal plans, you lose any meals you don’t eat. College meal plans can waste money, depending on an individual’s dining habits, so it’s important to pay close attention and make the full use of what the student or parents are paying for.

5. Live off campus. Boarding costs can be expensive. Colleges compete for the best living experiences for students, and that means they spare no expense in outfitting the dorms. My former college was on the forefront of internet connectivity. When I went to school, every dorm was wired for ethernet. This was not very common at the time, particularly considering there were only 2,738 websites on the internet when I entered college, and being on the internet generally meant reading news on Usenet or chatting with other Unix-connected students. Universities that pay for these amenities just add them to the cost of living on campus, yet most dorms don’t have kitchen, so living off campus can be a more cost-effective option. By living off campus, you can avoid costs for things you might not need while you can save money buy buying groceries and cooking rather than buying every meal pre-made.

6. Get student discounts. I held onto my student identification as long as I could to see if I could get discount admission to events and movies. Students are blessed with discounts for all types of expenses. Student discounts are worthwhile, and near campus, almost every business is wise to advertise a benefit for students. Sometimes, however, student discounts are not advertised, and business rely on word of mouth. Just ask for a discount if you’re not sure. Students qualify for discounts on computer software, equipment, hair cuts, theater performances, and even car insurance.

7. Get a job. I’m not a fan of spending a significant amount of time focusing on something other than studies during college years, but finding ways to earn an income has some benefits.

• With a job during college, you’ll have a head start against your peers, especially if your job is within the industry you’re likely to seek for a career.
• Getting experience juggling many priorities can help prepare you for life after college, even if it means having less time to focus on academics.
• Having a growing bank account in college will provide you with some experience dealing with finances that, if positive, will improve your relationship with money after college.

A job that worked well for me was working in the school’s music library and media center. It was quiet, so I could do work for my classes while also performing my job.

One goal for the four (or more) years of college is to survive financially. Many former students I know graduated with thousands of dollars of credit card debt, including me, thanks to inattention to money. College is the time for students to show they can begin to function as responsible adults in society, and while many adults also suffer from poor money management skills, there is an opportunity to set the bar higher. If nothing else, simply paying attention and understanding expenses will put a student at the head of the class.

Photo: regexman

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