Back to Top
Skip to Site Search Skip to Utility Nav Skip to Top Nav Skip to Content
Close Main Menu

5 things every college student should know about personal finance

(March 23, 2015) - Money often is a topic of concern among college students, and many young adults have to make their own financial decisions for the first time while in college. It's crucial to build financial habits on a solid foundation, said Erick Jones, director of the University of North Georgia (UNG) Student Money Management Center, and he shares five tips that every student should know. 

1. Start early.

Whether building good credit or planning to fund long-term investment goals, the earlier you put good practices into place, the better off you'll be. Establishing a good payment history will help build your credit score and acquire more favorable terms when you negotiate credit. For investments, every year you delay means lost interest income and a lower overall return. For example, a one-time investment of $5,000 made at age 20 with a 10 percent rate of return is worth more than $225,000 at age 60. That investment made at age 30 is worth $87,000 and, if you wait until age 40, that same investment is worth roughly $34,000.  

2. Analyze your needs before taking a loan.

Federal student loans are a great option if you need help financing school, but they still charge interest, and you need to have a plan in place to pay them back. Examine all of your options before taking out a loan. If you do pursue a loan, make sure that your borrowing aligns with your future salary and borrow only what you need.

3. Have a spending plan.

College is expensive and demands a lot of time. Use a budget to keep track of your finances and stretch your limited resources. Go over your spending, prioritize your expenses and allocate your resources to the most essential items. Most people will spend the first 10 years after graduation paying back student loans; it's important to borrow only what you need.

4. Establish an emergency fund.

An emergency fund is money you keep in savings to pay for unexpected events that otherwise would require you to borrow extra money, or even worse, drop out of school. Try to keep three to six months' worth of living expenses in a separate account to pay for things like automotive repairs or other emergencies that might interfere with your ability to afford school.

5. Increased income shouldn't mean increased spending.

Getting a raise at work or a tax refund is a good thing, but you need to have a plan for these funds that aligns with your goals. Weekend trips or shopping sprees can be fun, but you may be better served in the long run by paying down your student loan debt or increasing your emergency fund. Living on a budget doesn't mean that you can't have a full and rewarding college experience, it just helps ensure that you pay less for it over time.

The Student Money Management Center will hold a Financial Literacy Event on April 24 to discuss "Investing in a Culture of Financial Literacy." The event will focus on the importance of financial literacy and aims to help attendees build knowledge and best practices in boosting financial literacy at their institutions.

Paul F. Goebel, founder and managing senior director of the Student Money Management Center at the University of North Texas, will speak at the event. UNG students, faculty and staff are invited to attend; the event also is open to the public. Registration is $45 through March 31, then $60 up to the April 19 registration deadline.


Michael Marshall
Communications Specialist

UNG follows Section 508 Standards and WCAG 2.0 for web accessibility. If you require the content on this web page in another format, please contact the ADA Coordinator.
Please note that some of the images and videos on our site may have been taken before social distancing, face coverings and restricted gatherings were required.

Back to Top