10 tips for students to manage their finances better

College time is not just an exciting one but an expensive one too. With rising food and living costs, it is the need of the hour that a student, before heading for an education programme, attend a crash course on managing his/her finances.

Here are few tips students should consider to help them manage their money better, without compromising on making the most of their college experience:

1. Have a monthly budget: Every or rather most of the students receive pocket money, but the amount may vary. List down all the important and required expenses. However, make sure the budget is for primary or basic needs at this stage; avoid luxury and lavish spends.

2. Look out for scholarships: Every educational institution offers a scholarship programme. It will help reduce the overall cost of education and comes in handy if one has taken loan to fund their education.

3. Take up stipend programmes: Summer projects or stipend programmes are an integral part of college curriculum. However, all summer projects may not give this benefit. Hence, consider stipend programmes over and above the one offered by the college. It can be small assignments like assisting a faculty in research, taking up a job in your library etc.

4. Avoid impulse purchasing: Call it smart marketing or irrational behaviour, but the truth is a shopper sometimes ends up buying things he/she does not require. Before going to shop, make a list of items you need and stick to the list.

5. Limit the number of times you eat outside: Parties and hanging out with friends is common. However, have a budget for the same. Keep a sum aside for get-togethers, but limit the outings to save on monthly expenditure.  

6. Save and invest a portion of your pocket money:Money multiplies when it receives interest/returns and the same interest/returns in turn earn interest i.e. money working for you rather than you working for it. Save a portion of your pocket money in a savings bank account. Plus: it offers high liquidity i.e. money can be withdrawn as and when required.  

7. Look out for student discounts: Many airlines, restaurants, shopping complexes offer students discounts. Look out for these offers and avail them. "Every Penny Saved, Is Penny Earned".  

8. Buy second-hand text books/use libraries: Since most courses are split over semesters, books used in one seldom get carried over to the next semester. Consider buying second-hand books from seniors or former-students. Many retailers offer to purchase/buy back old books. Use this option to earn some extra money too. Libraries may also help you meet the requirement on short-term basis.

9. Avoid using credit cards: They may lure you as the pinch of money outgo is not felt at the time of purchase. However, don't forget that the purchase is not free: the payment will have to be made, even though at a later date. Most credit card companies also levy late-payment fee, wherein the interest on late payment can go up to 3 per cent per month.

10. Use public transport or vehicle-pooling:Commutation eats into a good portion of your monthly allowance. Use public transport or tie-up with college/class mates for vehicle pooling to cut down on costs.

(The author is CEO and Founder, Right Horizons)