The Student News Site of Tarrant County College

The Collegian

The Student News Site of Tarrant County College

The Collegian

The Student News Site of Tarrant County College

The Collegian

Home-cooked meals, thrift stores help build savings accounts for debt-prone consumers

By Micki Houk/reporter

For most students, the first few years out of high school are the time they experience the real world. Some stay at home while others move out on their own into apartments or small houses with a roommate or two.

The second scenario, although not uncommon, is one of the leading causes of debt for students in their late teens and early 20s.

Most simply don’t know how to budget their money.

“First, before students move out, they should talk to their parents about typical monthly expenditures they are likely to have,” said Xiujun Farrier, South Campus accounting professor. “That should offer some ideas on where and how the money goes.”

Ferrier said students should then prepare a budget for themselves.

“The budget should start with the necessities: rent, utilities, transportation, groceries, etc.,” she said. “After budgeting for necessities, the student should determine how much is left for discretionary expenses and savings.”

Fixed expenses are not the only things that take the money out of a student’s pockets. Most of the time the real culprit is unplanned expenses like gas, clothes, entertainment and emergencies.

“There are three simple ways to cut costs,” NE accounting professor Angela Martin said. “First, cooking at home instead of eating out all the time can save around 30 to 40 percent of your food budget for the month. Second, discover your spending habits by writing down how much you spend and what you spend it on. Finally, pay in cash.”

Martin suggested making envelopes of cash for each non-fixed expense. When the envelope is empty, the spending for that budget item for the month is done.

Students can satisfy some spending adventures while still being frugal. For clothes, they can consider shopping at secondhand stores. Goodwill, Plato’s Closet and other thrift stores offer a few good finds for just a little digging through the racks.

When seeking entertainment, they can take advantage of student discounts. Many movie theaters and some special events offer discounted tickets with a student ID.

Credit cards are another big budgeting mistake first-time college students make. Credit cards are not free money and will have to be paid back with interest one day.

“I do not own a credit card right now,” NW Campus student Rachel Lane said. “I plan on getting one in the future, but I will pay it off every month. The only reason I want one is to build credit for future buys, such as a house or a car.”

With debit cards, credit cards are no longer needed for the quick spending they were once used for. Martin said students should avoid credit as much as possible and pay off as much as possible at the beginning of the month.

The longer students pay only the minimum balance, the quicker the interest payments pile up, and the quicker the limit on that card is reached.

“Personal finances are hard work,” Martin said. “You need to budget your money, but you also need to budget time to sit down and know where you are with your finances. Eventually, you will get the right budget to follow for your lifestyle.”

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