College life is always considered great. As the school year ends, the students enter not only the college life but also the real world. College life for many students is an announcement of freedom. Freedom also means handling money in the form of pocket money either from elders or a few bucks you earn by doing part time jobs. But this new found financial freedom can turn into a disaster if you are not careful about the way you handle money. Here are a few top 5 money mistakes that many of the students make:
Not Listening to Elders Who Know Better
It's always good to keep your elders informed about what you're spending and where you're going. In Case if you land up in any financial trouble then you can always look upon them. As elders have passed all these years they would know what is good for you. Do not feel that they are advising but take it in the right sense and always be with them.
Not Budgeting Your Income and Expenses
Budgeting is an essential planning tool for a college student. It shows how you need to manage your bills and expenses and wisely use your money. It helps you to plan ahead by knowing about how much money you will have, and your expenses shows you where it has gone out and when. After all, if you end up spending more money then you're likely to end up with problems. So always be aware and have a small account on whatever you're spending.
Getting a credit card
A lot of students feel having a credit card is considered cool in college campus. Well there' s nothing wrong in owning a credit card, but the mistake is when they start using the card unnecessarily. This is the worst mistake done by any student because of the high interest which comes out when one has to pay back the debt. At the moment using a credit card will relieve you from the situation but later to pay back the debt it's really hard. The recent research found out that an Average Students Loan Debt is 23, 000/- by the time they graduate. So it's advised to use the credit cards only in emergency cases.
Inappropriate spending of student Loan money
Student loan is to finance your education, and not for your other expe nses. Student loan is for tuition, room rent, food, and for books are the smart ways to spend your student loan money. But, spending it for going out and treating your friends is not a good idea. Students feel that it would be easy to repay the loans back but what if you don't have a job. So think before you spend. Keep the student loan only for academic expenses and not for other purposes.
Lending Money to Friends
Making good friends is very important for a student entering college. There would be so ma ny different people in your class, but be sensible in choosing your friend. At the same time see to it that if your friend needs your help financially then he/she should be able to repay you back. And if they regularly ask for money then it's high time you leave them.