CollegeForget the "freshman 15," the dreaded additional pounds freshmen frequently pack on when they settle into life on their own. More important are the 15 smart financial moves you need to know to get through freshman year and beyond without racking up unnecessary debt.

"Waiting until after college to take control of your finances could cost you," says Nick Certo, senior vice president in University Banking at PNC Bank.
"And like any good fitness regimen, getting started is half the battle."

Here's how to pass finance 101.

1. Be careful with credit

Free T-shirts are the late-night burritos of finances, Certo says. "They look good now, but you'll pay later. Think twice before signing up just to score some cool swag," he says.

It's not worth it to saddle yourself with a high-interest, annual-fee credit card that you don't need. Buy a T-shirt instead, and your bank account will thank you later, says Jackie Warrick, the chief savings officer at

Remember that a credit card doesn't equal free money. If you can handle a credit card, start with a $1,000-limit card that offers points or other rewards and pay your balance monthly. "Don't look at your credit limit as a goal for spending," says Steve Weisman, a senior lecturer at Bentley University. "Carrying too high a balance on your card can hurt your credit and cost you more." Late fees can add up quickly.

Research which card makes the most sense given your spending habits and paying ability. Look at the annual percentage rate, annual fee, grace period and penalty fees, says Todd Mark, vice president of education for Consumer Credit Counseling Service of Greater Dallas.

Also, keep track of your credit score and your credit report.

2. Stick to a budget

Make a budget. You don't have to go crazy with the details. Just outline how much money you receive monthly and what you need to spend. "Include an allowance for walking around money, and don't just go to the ATM for more than you budgeted, or you will frequently run out of money before you run out of month," says Burton Speer, a certified public accountant with Mengel, Metzger, Barr & Co.

Then, track your spending to make sure you're sticking to your budget. "Unlike the federal government, you can't just print more money," Speer says. "Spending less is often easier than earning more."

Check out your bank's website budgeting tools, as well as software programs like Quicken, to help keep your budget on track.

And take extra care of your wallet when you're out partying. It's easy to get caught up in the moment and dish out more than you want to spend when you're having fun. "When going out with friends, decide ahead of time how much you can afford to spend, leave the rest behind," says Tahira Hira, professor of personal finance and consumer economics at Iowa State University.

3. Save early and often

In your 20s, you have a small window of opportunity to wield the power of compounded interest. Consider this: If you save $3,000 a year when you're between 20 and 30 years old, put the money into an IRA with a 7% average annualized rate of return and never save again, you'll have $442,000 by the time you're 65, calculates Nicole Rutledge, a certified financial planner with Resource Consulting Group.

However, if you wait to begin saving until you're 30 years old and put in $3,000 each year until you're 65, you'll end up with only $283,000 at the same rate of return. That's 35% less than if you had just saved the money in your 20s, even though you'd have put in more than three times the amount of money.

So save regularly now. Skip a pizza or a couple of pitchers of beer a week and save for emergencies and retirement. Just save.

4. Take advantage of student perks

Don't spend extra money on food if you have a cafeteria. Research college meal plans, which can be much cheaper than outside meals. "It might not be offering the meal you want, but that's another charge you won't have to make," Mark says.

And when you do go out, take advantage of any student discounts at businesses or venues you frequent.

5. Pay less for textbooks

The average student can pay $1,000 a year for books, an often unexpected high cost for college freshmen, says Michael Geller, vice president of marketing for

Don't buy new books at the campus bookstore. Campus prices are almost always higher than at online retailers like or, says certified financial planner Derrick Kinney. Consider renting textbooks at your school's bookstore or from sites like Renting books or buying them used can save you 50%.

If you're using an online site, sign up for a rebate program, such as, which gives money back on each purchase. And remember to sell used books back at the end of the semester.

6. Borrow as little as possible

The average college student leaves school with about $23,000 in debt. "Borrow just enough to pay for your legitimate college costs," Hira says. "Explore all options. A student loan should be your last resort."

If you do borrow money, make sure you fully understand the cost and other terms of the loan before signing on the dotted line. The cheapest loans come from the federal government, says Ruth Vedvik, principal at Hardwick-Day, an enrollment consulting firm. And because federal interest rates are set, you know how much debt you're taking on, she says.

Remember to start looking into funding early and to submit applications before the deadlines. Search online for scholarships, grants and other financial aid based on gender, religion, race, ethnicity, the type of degree you want or other relevant criteria, suggests Ornella Grosz, author of Moneylicious: A Financial Clue for Generation Y.

Also consider working part time, which can decrease the amount you have to borrow.

7. Get organized

Little things can chip away at your budget. Avoid parking fines or late fees for library books or videos and CDs rentals, for example, says Cheryl Smith, financial adviser with JHS Capital Advisors.

Also, nail down your schedule early. "Many students wander into each semester and don't meet with their adviser and figure out which classes to take," says Rachel Cruze, host of the Graduate Survival Guide. "This can be costly when it comes time to register. If a class fills up before you can get in, you may have to take it during summer school or even stay an extra semester."

8. Avoid unnecessary fees

Avoid paying extra ATM fees by researching your bank's ATM availability on campus. These small fees can add up. After all, if both your bank and the bank hosting the ATM charges a $1 fee for each $10 withdrawal, that amounts to a cost of 20%, says Kathryn Mullaney, vice president for finance at St. Lawrence University.

If your bank doesn't have a branch in your college town, it might be smart to open an account at a different bank so you can get cash without paying those fees.

Overdraft fees range from $35 to $50, so consider getting overdraft protection to avoid those charges, even if it means asking a parent to sign up for the account with you, Mullaney says.

9. Use technology wisely

Set up text and email alerts for your bank accounts and credit cards to help you keep tabs on your spending and avoid missing payment dates. "It's an easy way to stay in-the-know about your own finances," says Justine Rivero, credit adviser at "Plus you can make sure you don't ruin your credit by missing a payment or maxing out your credit card."

10. Protect yourself from fraud

Research conducted by Javelin Strategy & Research found that it takes 18- to 24-year-olds nearly twice as long to detect fraud compared to other age groups, making them fraud victims for longer periods of time. Young adults are also more likely to fall victim to fraud and identity theft by people they know. Living in a dorm, where other students or strangers might easily access a student's room, also ups the need for vigilance.

Take advantage of services that allow you to monitor your accounts regularly, such as by reviewing statements online or using mobile banking to see a snapshot of your account information, suggests Secil Watson, senior vice president at Wells Fargo Internet Services Group. Students can also forward sensitive mail, like financial information, to their parents' homes.

11. "Insure" success

Parents can help you save money through insurance. June Walbert, a certified financial planner with USAA, advises parents to re-evaluate their insurance when a child heads to college. "The increased liability of a child away at school potentially opens the door to a number of financially catastrophic events," she says. "Re-examining your family's insurance needs in the wake of a college-bound child can not only safeguard your finances, but even lead you to insurance savings."

Homeowner's policies provide limited coverage of children's personal property, and usually come with a large deductible. Opting for a renter's insurance policy provides better coverage with lower deductibles, Walbert says.

If your child is taking a car with them, update the usage. If school is 100 miles away or further, some insurers will offer a discount. Insurers also usually provide discounts for students with B averages or better.

12. Capitalize on coupons

It's no longer geeky to clip coupons. "Don't think your friends will mock you and call you a coupon-clipping grandma if you use coupons or deals," Warrick says. "They'll probably be jealous of the additional money you'll have to spend for next week's party."

Daily deal sites like Groupon offer deals on dining out and other services that can help you maintain your budget. And if you have unused gift cards you don't want, you can trade them for cash on sites like and

13. Master relationships

Personal relationships that you make now can turn into business relationships in the future, says Dan Greenshields, president of ING (ING) Direct Investing. Make friends and also find a mentor in your desired field to get career advice. Being social now could boost your prospects in the future.

14. Invest in your future self

Seek out internships and volunteer. Learn skills that will help you land a job later. Employers are increasingly expecting more from candidates. Investing in yourself as a freshman will pay you back for years to come, Greenshields says.

15. Set limits

If you're going to spend more than $50 on something, figure out if you really need it. The $50 dollar limit, Cruze says, is a good point to stop and ask yourself if you can do without it. "Is the restaurant too expensive?" she says. "Do you really need that video game now, or will it drop down 30% in three months? Ask yourself what you can do without."

Increase your money and finance knowledge from home

Introduction to Retirement Funds

Target date funds help you maintain a long term portfolio.

View Course »

Advice for Recent College Grads

Prepare yourself for the "real world".

View Course »

Add a Comment

*0 / 3000 Character Maximum


Filter by:

I lived on ebay and cooked for myself. saved me at least $1000 every school year

here is another interesting article:

April 22 2012 at 7:48 PM Report abuse rate up rate down Reply
John Powers

I always try to take advantage of student discounts. For example, I save money on movie ticket that way. I also joined this college deals program. They send me deals and coupons on things on campus like drinks, clubs, textbooks, pizza, etc.... I save money and am able to do more things, because my budget stretches a bit further this way. See if your college campus is listed there. It's free! Here is the link:

March 12 2012 at 12:15 AM Report abuse rate up rate down Reply
John Powers

I always try to take advantage of student discounts. For example, I save money on movie ticket that way. I also joined this college deals program. They send me deals and coupons on things on campus like drinks, clubs, textbooks, pizza, etc.... I save money and am able to do more things, because my budget stretches a bit further this way. See if your college campus is listed there. It's free! Here is the link:

March 12 2012 at 12:14 AM Report abuse rate up rate down Reply
John Powers

I always try to take advantage of student discounts. For example, I save money on movie ticket that way. I also joined this college deals program. They send me deals and coupons on things on campus like drinks, clubs, textbooks, pizza, etc.... I save money and am able to do more things, because my budget stretches a bit further this way. See if your college campus is listed there. It's free! Here is the link:

March 12 2012 at 12:12 AM Report abuse rate up rate down Reply
Lexie Puckett

This is a great list of tips for students, especially the advice for students to keep themselves out of credit card debt, as well as borrow as little as possible. I am almost thirty and I have tons of friends who are paying back debt from college. Parents that can afford to pay their child’s tuition and living expenses may want to consider investing in a rental property. Instead of paying rent for their child they can put it towards the equity in an investment home. Check out this list of 10 great college towns to invest in

August 10 2011 at 6:14 PM Report abuse rate up rate down Reply

I'd recommend using a site like or Fastweb to apply for and win scholarships & grants. Nothing helps trim the tuition bill like a few thousand dollar scholarships!

August 10 2011 at 12:23 PM Report abuse rate up rate down Reply

As a college student, this saves my life completely.

August 02 2011 at 8:08 PM Report abuse -1 rate up rate down Reply

Unless your parents are wealthy, your better off going to a Jr. college or community college and living at home..
About 1/2 of yearly college costs are room & board...When you transfer to a four year College, that College's name
is on your sheep skin , not the college you attended before ..Know it turns a lot of freshman students off when they have 400 students in ther English 101 or Biology class ..Big adjustment some can't handle ...

August 02 2011 at 10:22 AM Report abuse rate up rate down Reply

7% return......where is that in the last 10 years? Funny many years ago the Finicial Planners used 10-12% for these models. A few more years of this BS, they will be using 3% and you will have no real growth (inflation ate it up). My daughter bought a house by the campus, did some sweat equity, rented out the extra rooms, lived there free and made about $300/month on top of that. Sold it ,made $$$ (before the crash), but they really did not fall much in value as it was a true "income" property. Went onto med school, bought another, sweat equity, rented to classmates, lived there for free and makes $400/mo on top of it, now almost done with her residency. She will be selling soon and will probably loose $20K on it, but still way ahead of renting or if she would have "invested" her original seed money in the last 10 years.

August 02 2011 at 12:23 AM Report abuse rate up rate down Reply

I'm sorry Khod3 you neglected to tell us where to get the 100-200K to get started. How are my "not rich" parents going to fork over this money if they are, well, "not rich".

August 02 2011 at 12:10 AM Report abuse rate up rate down Reply