Budgeting is easy — just be careful and plan.
Freshmen coming to Ohio University are likely to want to try all that Athens has to offer. It’s a feat that can be fun as one samples different coffee, pastries, cultural cuisine, sandwiches and more. It’s also a feat that can weigh heavily on a wallet, as one shells out $2.25 for a large coffee at Donkey Coffee and Espresso, $3.50 for a waffle cone at Whit’s Frozen Custard, $2.50 for a slice of GoodFellas pizza, $6.29 for a Big Mamma’s burrito and more.
Cheyenne Sears, a senior studying linguistics and French, said she tries to circumvent certain daily expenses by buying the cheaper brands in stores and having her underclassmen friends occasionally swipe her into a dining hall.
“I honestly don’t really have a plan other than spending as little as possible,” Sears said.
Personal savings are at near-record lows in America, according to a 2014 article in Bloomberg Business. Building room into a student’s budget to put away money for the future can be really helpful, said Natalie Chieffe, an associate professor emerita of finance and a certified financial planner.
“Instead of thinking about buying now, look at your savings account as a foundation for things you can have later,” she said. “It might only be $10 now, … but it builds up, and it’s going to be ... a special outfit, a vacation, your first home.”
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If you receive an income, Heidi Sochia, marketing and education specialist at Ohio University Credit Union, recommends having a portion of the paycheck automatically dispensed into a savings account so that money is never “missed.”
Sochia recommended keeping track of personal finances on paper just as much online because certain payments — such as checks — won’t automatically be reflected in an online statement.
Specifically for freshmen, Sochia advises all 18 year olds to check their credit report on annualcreditreport.com. If anything shows up on the credit report, she said, it could indicate identity theft.
But even those starting out without any credit might still be eligible for loans, Sochia said. A co-signer or proof of income that could cover payments would just be needed.
Students can also take steps during college to build a good credit score, which can help with post-graduation life such as applying to rent an apartment. Both Sochia and Chieffe said to start small with one credit card, using it for purchases that can, without question, be paid off by the cardholder.
“Making payments on time is the most important thing that your credit score is calculated by,” Sochia said.
In a 2013 survey of 750 college graduates conducted by Fidelity Investments, the students graduated with an average of $3,000 in credit card debt.
For an 18 year old looking to open his or her first credit card, Sochia advised everyone to remember that a credit card must be open for at least six months and have at least one payment in that time to establish credit.
Paying off the credit card bill on time each month results in positive credit reports, which can lead to boosts in a credit score, which Sochia called a “snapshot” of someone’s credit report at a particular time.
Paying the bill on time also means the individual does not have to pay interest on the unpaid amount, which is something Chieffe said is unwise to do. The unpaid amount of a bill accrues interest, and, as it sits, the debt grows, as one pays interest on top of the original sum, plus its accrued interest.
“Unfortunately, it just gets bigger,” Chieffe said. “Everything you bought that month now costs more. … Most things should be paid off in the amount of time you’ll be using them. … Always pay the full amount even if it means you can’t do some other things.”
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