All across this great country, college campuses have welcomed a new class of freshman. These young people arrived with a lot of things, but financial literacy was likely not one of them.
If I could spend a little time with these awesome students, this is what I would attempt to cram into their heads and then pray that it penetrates their hearts:
A BUDGET IS YOUR FRIEND
That means you 1) have a written plan for how you are going to spend your money 2) you use that written plan like you would a road map, consulting it often, and 3) you use a site like Mint.com or a pencil and paper to record how you spend every nickel. Sallie Mae has a monthly budget worksheet you can print out to help you estimate your costs and keep expenses under control. Do not attempt to do this keeping-track thing in your head. You are amazing, but don't push it!
GET A FREE CHECKING ACCOUNT
It's not easy these days to find free checking accounts with no strings attached — no monthly fee, no minimum balance requirement and no minimum deposit. But many banks like U.S. Bank offer free student accounts that fit these criteria. Explore banking options in the city where you will be attending school, or find out if the bank or credit union that your parents already use offers free student accounts and has a branch near the college campus.
CREDIT CARD DEBT
Don't be ridiculous. Credit card debt — a balance owing that you roll over from one month to the next, paying only the minimum required plus interest — has the potential to sink your ship. Think of it like cancer. At first it's just a tiny thing that's not that big of a deal. But then it starts to multiply, and if it's not dealt with swiftly, it will do horrible things in your life.
LIVE WITH CASH
Your generation has been somewhat brainwashed to believe that plastic is the only safe way to pay for things. That may be true if you buy things online, but overall it is just not true. I don't have the time or space to get into a long dissertation on the subject. Just believe me when I tell you that using cash — currency, greenbacks, dollars, coins — will simplify your life and keep you from overspending.
EAT YOUR FOOD PLAN
If you or your parents have paid for the school meal plan, you need to know how many meals are covered and then do something remarkable: actually eat those meals. If you're eating pizza in your dorm room or driving through Burger King instead, you're just throwing away money. It might feel cool to spend your money like that now, but you will regret it later.
DON'T BECOME A STARBUCKS REGULAR
I want to say never, but I'll compromise a bit on this one. Seriously, the coffee at Starbucks or Coffee Bean or any other trendy coffee house is so expensive it nearly makes me choke.
Let your grandparents and others know how much you love Starbucks gift cards. They are anxious to know what they can send to you while you're away. Then use the gift cards instead of your cash.
Think about it: If you spend $3 a day at Starbucks, that's $90 a month. On coffee. Multiply by nine to see how much you'll buy in a school year ($810). You don't want to spend your money that way. Buy an inexpensive coffee maker instead, and make it yourself in your room.
BUY USED TEXTBOOKS
The cost of new textbooks is going to be so shocking it will make you want to chew your hair. You can cut that cost in half at least by buying used books online or even renting them.
Students who couldn't secure a scholarship for the fall semester shouldn't give up hope. Many scholarships have spring deadlines, so continue your search during this school year and next year. Just keep applying.
Take these basic money principles and apply them to your life starting now. You will never regret it.
And have a great year!
Mary invites questions, comments and tips at [email protected], or c/o Everyday Cheapskate, 12340 Seal Beach Blvd., Suite B-416, Seal Beach, CA 90740. This column will answer questions of general interest, but letters cannot be answered individually. Mary Hunt is the founder of www.DebtProofLiving.com, a personal finance member website and the author of "Debt-Proof Living," released in 2014. To find out more about Mary and read her past columns, please visit the Creators Syndicate webpage at www.creators.com.