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7 Important Financial To-Do’s for First-Year College Students

Learning to manage finances is an important part of growing up, and college is a great time to do it. Start now with these tips before you head to campus!

Before you know it, you’ll be taking your first steps on a college campus as a newly enrolled student. But before you start decorating your dorm room or shopping for shower caddies, it’s important to spend some time getting your finances in order. It may not sound as exciting as picking out the perfect laptop or tablet, but it will help you manage your money wisely throughout your years in college. Here are seven financial tasks you should tackle before your first day of classes.

1. Make sure your financial aid is squared away

Before heading to college, make sure your financial aid is in order. Besides filling out the FAFSA or the CSS Profile to qualify for federal, state, and institutional aid, it’s also a good idea to explore independent scholarship and grant opportunities. You can find scholarships and grants on websites like:

If you need to take out private student loans, submit your applications well in advance. Private loans can take several weeks or even months to process, so starting early ensures you’ll have the financing you need to cover the upcoming semester. 

Related: How to Appeal Your College Financial Aid Package

2. Open a checking account

If you don’t already have one, opening a checking account will allow you to access your money easily throughout the academic year. If you have a part-time job or side gig, you can deposit checks into your account and use your debit card or take out cash at ATMs. Many banks and credit unions offer student checking accounts with low fees and no minimum balance requirements. They may also have perks like no ATM fees and mobile apps that allow you to make deposits from your phone. When looking for a bank, make sure the ATMs on campus are in your bank or credit union’s network; otherwise, you could pay for every withdrawal. 

3. Consider a credit card

If you haven’t had a credit card before, getting one early in your college life can help you build your credit history (and is useful in emergencies). There are three main options for students:

  • Student credit cards: These cards are easier to get than traditional cards, and they can help you establish a strong credit history while you’re in school.
  • Secured cards: This can be a useful alternative if you’re worried about racking up debt. They require a security deposit, which acts as your credit limit. The limit keeps you from overspending, but your activity is still reported to the credit bureaus.
  • Authorized users: If you have a parent or relative with a credit card and a solid credit history, ask if they’ll add you to their account as an authorized user. Even if your family doesn’t give you a card to use, becoming an authorized user allows you to benefit from their credit limit and payment history, giving you better credit than you’d have on your own.

Related: Financial Learning: Why Does My Credit Score Matter?

4. Create your budget

As a high school student, you may be solely in charge of your money, and maybe your parents have been making major decisions for you. Handling it yourself can be an exciting experience, but you need to create a budget and manage your spending to avoid draining your bank account or racking up debt. Apps like Mint, GoodBudget, and Personal Capital sync with your bank accounts and help you manage your money online. You can also create a budget with just a pen and paper with a few easy steps:

  • List your income for the month: List all sources of income, including earnings from a job, student loans, or any money your family may give you to cover living expenses.
  • Think about your expenses: Next, write down all your expenses, such as car insurance, gas money, school fees, or groceries. Make sure you also include nonessential expenses such as streaming services, video games, or trips to the movies.
  • Trim necessary expenses: If your expenses are higher than your income, you may need to make some tough decisions and trim your spending. Or you could get a part-time job or side gig to cover the extra expenses.

5. Check your auto insurance policy

Car insurance for young adults can be incredibly expensive, so check with your insurance company to see if you qualify for any discounts. Many companies offer good student discounts for those who maintain a B average or higher. And in many cases, first-year students aren’t even able to bring their cars to campus. If you have to leave your car behind, ask your insurance company about away-from-home discounts. Some insurers will reduce your premiums if your car is stored away and unused while you’re in school. 

Related: How College Students Can Save Money on Car Insurance

6. Make sure you have health insurance

Colleges typically require students to have health coverage, so find out if you can get insurance through your school if you’re not already on your parents’ policy. If you don’t have access to other forms of health insurance, you may qualify for a low-cost policy through Healthcare.gov. If you take any medications regularly, check with your insurer about what pharmacies are in-network and find one near campus—you’ll typically pay a much lower cost. If there isn’t one near your college, you may be able to use a mail-order pharmacy instead. Alternatively, you may be able to purchase low-cost medications through CostPlusDrugs.com, which provides generic medications at affordable prices, or by signing up for a free FamilyWize prescription savings coupon.

7. Freeze your credit

As a new college student, you’re a prime target for internet scammers and fraudsters. In fact, the Federal Trade Commission reports that identity theft and fraud scams impact over 42,000 people 19 or younger, costing them $51 million in losses. Placing a freeze on your credit report (after you’re done opening new accounts yourself) prevents thieves from using your information to open credit card or loan accounts in your name. It’s free to do, and it won’t affect your credit score. You can set up a credit freeze online through each of the three main credit bureaus: Equifax, Experian, and TransUnion. 

Related: 5 Common Tricks Fraudsters Are Using to Target Students

Financial literacy and stability are important, and college is the perfect time to learn important money skills for a better life. While you never want to make mistakes, sometimes things happen—you can learn from them and come out wiser. But with these tips, you can do your best to prevent major money mishaps from the start. 

For more money management and saving tips, check out the “finances” tag to become a pro with your bank account!

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About Maxime Croll

Maxime Croll is a Senior Director and Insurance Product Manager at ValuePenguin.com. Previously, she was the Director of Product Marketing at CoverWallet—a commercial insurance start-up—and also helped launch NerdWallet's personal insurance business. Maxime has contributed insurance insights and analysis to Forbes, USA Today, The Hill, and many other publications.

 

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