Budget. Spending plan. The thing that shows where my money is supposed to go. Whatever you call it and however you might feel about it, a budget is an incredibly powerful tool.
In fact, operating without one is like playing a game where you don’t know the rules.
One of the most beneficial things you can do while in college is create a budget for yourself so that you know how much money you’re going to spend—and hopefully save—each month.
Before talking about budgeting specifics, it’s important to remember a few things.
Everybody’s expenses are different. Everybody’s priorities are different. Make sure you tailor your budget to your lifestyle and goals.
Make sure you’ve got enough cash for your housing, transportation, tuition, groceries, and other must-pay bills. Whatever is left can be used for saving, entertainment, clothes, and all the other fun things you want to do.
While 65, 55, 45, 35, or even 25 might feel like a long time from now, starting to save now will help you afford a house, a car, a trip, a marriage, a life.
So now that those little tips are out of the way, you probably want me to tell you how much you should allocate for each section of your budget.
I’m not going to do that—at least not completely.
As it says above, “everybody is different.” Where one person may only allocate X towards their groceries each month because they only need pasta to survive, another person may need to budget Y because they want fresh meats, fruits, vegetables, and so on.
Instead, I can give you guidelines. It’s up to you to determine what’s most appropriate from you, and if you still need help or have questions, you can contact us at mnysmrt@iu.edu or set up an appointment with a peer educator.
These are the things that are generally in a budget. Even if they’re $0 on your budget, just remember that you could have them someday.
The percentages next to each category are the recommended allocation amounts.
Again, remember that these are guidelines and that your situation could very well be different. Still, try not to go too far above these numbers.
When making your budget, you might think that the numbers you’re coming up with are too small (e.g., $1000/month income, only means $250 for rent or $350 for rent/utilities combined), but truthfully, that’s about where the numbers should be.
You’re a college student. You don’t have a lot of cash right now.
If you need a more expensive place, you’ll have to make a trade-off. If it’s food that you limit, maybe it just means less meals eating out, or less expensive grocery foods. If it’s entertainment, maybe you have to start staying in and watching movies instead of going out.
Try to make choices that promote a financial advantage and result in savings.
The decisions you make now can have serious consequences after graduation. Not everyone gets a job three months after leaving school. Establishing “cash reserves” for the future is commendable if you can do it.
One last tip: prepare your budget before you even step on campus. Use our calculator to see how things stand for you. And if you need some help figuring out what your budget should be, schedule an appointment with a peer educator, they’d be more than happy to assist.
