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The New Freshman 15: Financial Tips for College Students


Forget the "freshman 15," the dreaded additional pounds freshmen frequently pack on when they settle into life on their own. More important are the 15 smart financial moves you need to know to get through freshman year and beyond without racking up unnecessary debt. 

"Waiting until after college to take control of your finances could cost you," says Nick Certo, senior vice president in University Banking at PNC Bank. "And like any good fitness regimen, getting started is half the battle."

Here's how to pass finance 101.

1. Be careful with credit

Free T-shirts are the late-night burritos of finances, Certo says. "They look good now, but you'll pay later. Think twice before signing up just to score some cool swag," he says.

It's not worth it to saddle yourself with a high-interest, annual-fee credit card that you don't need. Buy a T-shirt instead, and your bank account will thank you later, says Jackie Warrick, the chief savings officer at

Remember that a credit card doesn't equal free money. If you can handle a credit card, start with a $1,000-limit card that offers points or other rewards and pay your balance monthly. "Don't look at your credit limit as a goal for spending," says Steve Weisman, a senior lecturer at Bentley University. "Carrying too high a balance on your card can hurt your credit and cost you more." Late fees can add up quickly. 

Research which card makes the most sense given your spending habits and paying ability. Look at the annual percentage rate, annual fee, grace period and penalty fees, says Todd Mark, vice president of education for Consumer Credit Counseling Service of Greater Dallas.

Also, keep track of your credit score and your credit report

2. Stick to a budget

Make a budget. You don't have to go crazy with the details. Just outline how much money you receive monthly and what you need to spend. "Include an allowance for walking around money, and don't just go to the ATM for more than you budgeted, or you will frequently run out of money before you run out of month," says Burton Speer, a certified public accountant with Mengel, Metzger, Barr & Co.

Then, track your spending to make sure you're sticking to your budget. "Unlike the federal government, you can't just print more money," Speer says. "Spending less is often easier than earning more."

Check out your bank's website budgeting tools, as well as software programs like Quicken, to help keep your budget on track.

And take extra care of your wallet when you're out partying. It's easy to get caught up in the moment and dish out more than you want to spend when you're having fun. "When going out with friends, decide ahead of time how much you can afford to spend, leave the rest behind," says Tahira Hira, professor of personal finance and consumer economics at Iowa State University.

3. Save early and often

In your 20s, you have a small window of opportunity to wield the power of compounded interest. Consider this: If you save $3,000 a year when you're between 20 and 30 years old, put the money into an IRA with a 7% average annualized rate of return and never save again, you'll have $442,000 by the time you're 65, calculates Nicole Rutledge, a certified financial planner with Resource Consulting Group. 

However, if you wait to begin saving until you're 30 years old and put in $3,000 each year until you're 65, you'll end up with only $283,000 at the same rate of return. That's 35% less than if you had just saved the money in your 20s, even though you'd have put in more than three times the amount of money.

So save regularly now. Skip a pizza or a couple of pitchers of beer a week and save for emergencies and retirement. Just save.

4. Take advantage of student perks

Don't spend extra money on food if you have a cafeteria. Research college meal plans, which can be much cheaper than outside meals. "It might not be offering the meal you want, but that's another charge you won't have to make," Mark says. 

And when you do go out, take advantage of any student discounts at businesses or venues you frequent.


To read the full article, please visit

By Sheryl Nance-Nash •

Nance-Nash, Sheryl. “The New Freshman 15: Financial Tips for College Students.” August 1, 2011. July 21, 2014. <>.

Debt's only a problem when the payments become overwhelming; you miss payments, or you find yourself borrowing money to make ends meet. To find out more about what debt means and how to stay on top of it, check out our eBook on debt.  

This eBook looks at all the different kinds of debt you can carry, the good and the bad, some guidelines to follow when you need to borrow money, and what to do if you find yourself in a pinch.

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