After reading my financial aid posts, someone asked, well, how exactly do I budget while in college?

Determine Fixed and Variable Costs

For some students, it’s easier to keep a small notepad or journal to write down how they spend their money. The student may write down their expenses such as a cup of coffee, a meal, or a night out with his or her friends. This notepad is a great to carry around with you with your laptop or purse.

However, before the next academic year starts, sit down and develop a list of all of your fixed and variable costs. A fixed cost may include your tuition, rent or room and board, car payments, car insurance, parking fees, and health insurance that may not change month to month. Variable costs mean costs that vary every month. These may include entertainment, gasoline, food, utilities, hygiene, clothes, car maintenance, books, phone, and any dues.

Remember to be honest with yourself. If you buy a cup of coffee every day, or a pack of gum every week, it’s important to list them.

Determine Sources of Income

Income may include anything from a part-time job to allowances from home, grants, scholarships, or loans. When developing a budget, it’s important to develop an increment of time. For example, you may get paid monthly. Divide up your sources of income monthly to make it easier to budget. If you receive financial aid at the beginning of the semester, pay off your tuition/rent/room and board for that semester, and divide the rest of the money up into months.

Drafting a Budget

Draft a budget to see if it balances. Now ask yourself, do my expenses exceed my income? If your expenses exceed your income, it’s time to cut back or get a job. If you have money left over, think about investing or saving it in your emergency fund.

Remember to monitor your budget every month and to adjust the budget accordingly. Some budgets are not going to be the same month to month. For example, you may have to budget for a holiday or birthday one month, but in another month.

Also remember that your first budget may not be perfect. It’s important to use trial and error and get to a point where the budget works for you.

It’s important when developing a budget to include savings. It’s important to save at least 10% of your income.

Emergency Fund

As always, it’s important to have an emergency fund because you never know what’s going to happen. Your car may break down, or you need to take an emergency trip to a doctor’s appointment. These “emergencies” should NOT be put on a credit card. They should be apart of your budget.


It’s always important to evaluate your priorities. Think about what’s important to you. Is it more important to have money saved up to start paying your student loans? Is it important to you to have money while you search for a job?

You can waste a lot of money in college and develop some serious credit card debt if you’re not careful.

Ask yourself, do I really want to be paying my student loans into my late 30s, my 40s or my 50s?

Think about how you spend your money. Do you buy coffee every day? Some places charge $4 for a drink. That will cost you about $120 a month if you buy it every day. Movies are also expensive. The average movie ticket is close to $10 now. When creating a budget, these should be rewards, not something that occurs on a regular basis. If they occur on a regular basis, how can they make you feel good? They become a standard.

Stay Motivated

It’s not easy to stick to a budget. It’s important to budget “fun.” It doesn’t have to be anything extravagant, but maybe a concert a month or a nice, sit down dinner a month. It’s your way of rewarding yourself for sticking to your budget. It’s just as important to have fun as it is to safe money.