By Thomas Ehlers
Athens, Georgia, is home to some of the best restaurants, housing, bars, boutiques, shops, entertainment and experiences that a college town can offer. Consequently, Athens is a place where students can burn some money if they are not careful.
According to the Institute for Women’s Policy research, 51% of college students are financially independent, meaning they are on their own when it comes to paying for college. Even to those who rely on funds from parents, budgeting is important to developing good habits and making the most with your money.
When creating a budget, it is important to differentiate expenses into wants and needs. Needs are items or services that are essential to life or class, like rent, loans, books, tuition or food. Wants are items or services one can do without, like Netflix or dessert after dinner.
A lot of students in college towns face temptation to live beyond their means. College is a time to try new things and experience the world. A successful budget provides needs on the limited amount of money while still allowing a student to enjoy some of what Athens has to offer.
I keep my budget with a pen and paper, but other methods such as mobile apps and Excel spreadsheets are common as well. To begin, take your total income or amount of money you expect to have for the month and divide it into categories depending on your needs (like food, gas, rent, student loans, etc.). Set aside a portion for an emergency fund and use a little bit on your wants.
During my junior year, I enrolled in a personal finance class where my classmates and I had to track our spending for the month. We kept up with every cent, dividing the different costs into categories like food, utilities and entertainment.
This activity showed me ways to cut back and save money in the long run. One change I made involved buying fewer drive-through and takeout meals. While picking up food after work is convenient, it is costly. After the activity, I limited the number of takeout meals per week and opted to prepare meals that were ready to eat when I got home.
Budgeting is not just looking at money. Budgeting is also making lists when shopping. Creating a list before buying groceries, supplies, clothing or other items is essential to long-term saving. Lists encourage buying items that are needed, as opposed to browsing the aisles and picking up whatever catches one’s eye.
Another aspect of our class project delved into internet subscriptions. In our increasingly online society, we pay for music and video streaming services, online marketplaces, professional sporting events, news and other online content. Keeping tabs on subscription rates and cancelling those that are no longer used can free up money in your budget.
One final thought I gathered from the project was keeping a long-term outlook. While a Dr. Pepper might sound good right now, holding off and using the money that eight of them could buy might allow you to pay for a tank of gas or a night on the town. Holding off on impulses creates larger opportunities in the future.
The concept of budgeting seems foreign to many students, but I find it to be very helpful in creating healthy spending habits that will pay off in the long run.
Thomas Ehlers is a journalism student at the University of Georgia.