4 Easy Steps to Start A Budget in College

One of the best skills you can learn is how to start a budget in college. It might not seem like an incredibly riveting side hobby, but if you can learn how to do it, you’ll be well on your way to being wealthy in the future.

Budgeting is a skill that takes time and effort. In fact, recent surveys show the vast majority of Americans don’t keep a formal budget. Many consider jotting down notes on a piece of paper or remembering expenses in their head ‘budgeting.’

To learn how to truly budget in college correctly, you need to follow the steps below.

Track Your Spending


The first step to any budget is knowing where your money is going. It’s helpful to look back at your last three months of expenses before you create budget categories.

Mint is a great tool to use to see what you spend. You can link all of your accounts in one place and view your entire financial picture at once. Mint will even tell you when your bills are due, which is helpful if you’re in charge of paying rent or utilities at your college apartment.

If you really want to keep track of your money, Personal Capital is a great tool to use to help you start a budget in college. Personal Capital actually calculates your net worth, so it would be fun to start using it as a college student and watch your net worth rise after graduation and as you progress through your career. That way you can look back at it years later and not only see how your net worth grew over time but, if you’re paying attention, what made it rise.

Personal Capital is free to use and has a lot of great features to help you manage your money better. If you’d like to learn more about how it works, check out our Personal Capital review.

Create Your Budget Categories


As a college student, you shouldn’t have too many expenses. You can leave items like life insurance off your list for now 🙂

There are other important categories to including in your budget and starting to budget in college is a great exercise. Depending on how much your parents help you, you might have to pay for your apartment, phone or cable bill, car insurance and more.

While my husband was in college, he worked 40 hours a week and paid for all of his expenses including his apartment rent, car and books. While that’s not something either one of us would recommend, it’s an example of a college student who had a lot to track.

Examine your expenses and create budget categories from them. Once you know your categories, write them all down in a list. That way, you know how much money you need to have to cover all of your expenses and any extras you might want each month.

After that, open a savings account for emergencies. This will help you avoid going into debt for unexpected expenses. Online banks like Ally and Barclays Savings have no minimum balance requirements, which means you can open a savings account with them with $5 or less and grow it from there.

Aim to have $500 or more in your emergency savings account to cover things like blown tires or other expenses for which you don’t have a set budget category.

Assess Your Income


As a college student, you might have many different streams of income. When I was in college, my parents gave me anywhere between $100-$200 per month to use for food and other necessities.

However, I also worked several different jobs in college. I worked in the special collections library, taught dance and worked in a scrapbook store. I think working as a college student is incredibly important. It teaches you how to manage your time wisely and makes you appreciate the money you earn.

I used the extra income I earned to have fun in college without spending a lot. I enjoyed college life, bought clothes and went on various road tips. It’s nice to be able to have money to do what you want before all of the realities of adult life set in.

That said, since you likely do not have a salaried job with a steady paycheck, you have to learn how to manage a variable income. It’s best if you can get one month ahead, using the previous month’s income to fund the following month.

You can start a budget in college with little effort. Here are 4 ways to budget in college so you can have fun and grow your money at the same time.

Keep Your Wits About You


Now that you have a system for tracking your spending, creating budget categories and living on income from the previous month, the last step is to keep your wits about you.

What I mean by that is making smart money decisions. Avoid high-interest debt (like credit cards) at all costs. The Credit Card Act mandates that credit card companies avoid advertising near college campuses. Credit card companies can and sometimes do engage in underhanded marketing tactics to get you to open accounts with them, so keep your eyes open!

If you avoid credit card debt and live by your budget each and every month, you’ll be better off financially than most adults. I personally wish I would have saved more of the money I earned in college, so I’m happy to share these tips in hopes that you will be more financially wise than I was when I was young.


How did you manage your money while in college? What are some other things you think are important for college students and their money? Do you think college students should have a credit card?

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