blogs archives cu careers
earning spending borrowing investing driving housing insuring

Join CEFCU today!

Find out more about the products and services we provide our members/owners.

Enjoy personal service and rewards with our Credit Card.


About Us

Contact the editors

Copyright © 2007-2015 Credit Union National Association Inc.

Just $5 can help you earn great rates with the new My Save Certificate. Visit for details.

NCUA Equal Housing Opportunity
Pay off your credit cards Starting Off On The Financial Right Foot Living Within Your Limits Your Quick Guide to College Loans Post-9/11 GI Bill Pays For Education Investing Is More Than Just Stocks
Log in to My MoneyMix



By Reyna Gobel
MoneyMix Contributor

You'll soon be living in a dorm and managing a budget for the first time—whether the money you have to work with is yours, your parents', or a combination. How do you make sure your budget's realistic, so you can avoid humbling midsemester phone calls to your folks asking for cash?

Follow these rules: Stay organized, know how much money you need, and figure out where your money's coming from.

how do you get organized?

Dr. Dottie Durband, director of the Red to BlackTM financial education program at Texas Tech University in Lubbock, says, "The first question I would ask a student heading off to college is, 'Do you have any financial documents that you will need to take with you?'"

Base college budgets on a full academic year.

Examples of documents you'll need include:

  • Car insurance paperwork;
  • Rental agreements for on- or off-campus housing;
  • Savings and checking account statements;
  • Investment account statements;
  • Promissory notes for student loans; and
  • Scholarship information.

Once you've gathered financial documents—and identified a place to keep them, such as stowing them in a folder or scanning your paperwork into a computer file—you can use this information to begin your budget. Documents that will help you the most include any that specify an exact amount you must pay with a due date. For instance, you generally pay for dorm rooms and meal plans on a semester-by-semester basis. Apartment rent is due monthly. Car insurance could be due monthly, quarterly, semiannually, or annually.

Because payment due dates can vary, base your college budget on a full academic year. You easily can lay out your budget in a calendar format, either by hand or by using your computer. Create rows to put expense categories such as room and board, tuition, entertainment, textbooks, clothing, and savings deposits. Underneath your rows for expenses, add rows for income. College income could be from a part-time job, your folks, student loans, scholarships, or an amount you're planning on withdrawing from savings or investments on a regular basis. Your columns should be months in your school year, such as September through June or August through May.

But how do you create a budget if you don't have a document that tells you an item's exact cost? "The school financial aid office will typically have an example you can refer to of the estimated expenses you will incur at that institution, including room and board, books, fees, parking, and laundry," says Ryan Law, director of the office of financial planning at the University of Missouri in Columbia.

 Research college costs.

 Understand federal student aid.

 Apply for scholarships.

If your budget doesn't come out exactly as estimated, have strategies in place for overcoming shortfalls. Jodi Kaus, director of programming for the Powercat financial counseling program at Kansas State University in Manhattan, suggests these tactics to cut your budget:

  • Use free university computer labs instead of buying a computer.
  • Check out movies and books from the library.
  • Go to free events sponsored by your university's student union.

Be prepared to adjust numbers in your budget as you go through the school year. Textbooks, food, clothing, and medical care are just a few expenses that could change in cost. Without organizing your finances, you wouldn't have a starting point for tweaking your budget as needed.

who pays?

There's only one rule when it comes to what expenses your parents pay for and which ones students pay for: It's whatever your family decides.

"Sit down with your parents before you head out to college and have a discussion about money," says Law. "Find out exactly what they are planning to cover and what is your responsibility."

Durband suggests that students ask their parents these questions:

  • Will you be able to provide for me financially while I'm in college? If so, how much and how often? Will you pay me an allowance or a stipend weekly, bi-weekly, or monthly?
  • Do you expect me to work while enrolled in school? If so, where and for how many hours a week?

If parents and students decide that a part-time job is going to be a part of college finances, Durband suggests preparing now by creating a résumé, so you'll be ready to apply for on- or off-campus jobs.

should you use all possible student loan money?

Have strategies for overcoming budget shortfalls.

Student loans add up. If you pursue a graduate degree, you could end up with $60,000 in student debt from federal student loans alone. If you graduate with $60,000 in debt, at an interest rate of 6.8%, your payments would clock in at $690 a month for 10 years, or $394 a month for 30 years.

How do you keep your payments down? Try to only use financial aid for necessary living expenses and school expenses such as tuition, fees, books, and rent, says Law. "Don't finance school with credit cards, and be very careful of private student loans."

Conducting your own financial prep rally isn't as fun as homecoming, but it will make life easier by limiting your debt after graduation and reducing stress while you're in school. Luckily, you aren't the only member of your team. Your parents, financial aid counselors, credit union financial advisers, and on-campus money management offices can advise you along the way. With a little preparation, you'll call your folks more to chat than to request emergency cash.

Published August 17, 2010

Recipient’s e-mail address
Your e-mail address
Add your comment

You must be logged in to post comments.