Building Wealth as a Working College Student

working college student budget

From time to time, I get emails from readers asking questions or looking for a listening ear on a idea that he or she has. One email I got was from a college senior who is working part-time. She’s tired of emergencies coming up and having her sink further into debt.

She asked if I could suggest a few things for her budget and after some back and forth we got a plan down that she can use for the next few months.

A Working College Student’s Budget

Based on the information I was given I created a budget that allowed her to pay her bills and save a bit. First let’s break down her monthly income and then look at her monthly expenses.

Monthly Income working college student budget

She is currently working part-time while going to school, meaning that her paychecks are smaller. The good news though is that she is working in the field she’s majoring in (though not the job she wants). Looking at her past paychecks she told me her take home pay each month is around $1,250.

As she gets closer to graduating (spring 2013) she’ll start applying for positions that her degree will qualify her for. Hopefully she’ll see a sharp increase in her income then, but for now she has to work with what she has part-time.

Monthly Expenses

The good news is that she splits the bills with relatives as she’s going to school and working. She also has no car loans; however there is credit card debt. It’s mainly cards with low credit lines, so she’d like to have one or two cards paid off by the time she graduates.

  • Housing: $200
  • Utilities: $100
  • Food: $200
  • Car Expenses (Gas/Insurance): $150
  • Doc/Health: $50
  • Savings: $100
  • Credit Card Minimums: $250
  • Debt Snowball: $50

Total Monthly Expenses: $1,150

As you can see, there isn’t a whole lot of wiggle room in her budget. However there are a few things she can do help with her financial goals that are fairly simple.

Sell Stuff and Save

One thing that I suggested was to sell some items to jump-start her emergency funds. She had some collectible items that could be sold on eBay or Craigslist for a bit of cash. Selling those items she didn’t really care about anymore would not only put a bit of money into her pocket, but it would also declutter her space.

Tutor Classmates

I wouldn’t recommend taking a second regular job for a full-time college student since time for studying is severely limited. What she could do though is tutor some classmates on courses she’s recently taken; perhaps have mid-term or final exam prep sessions for a small group of 3-4 people. She could get a small boost in cash without having a huge time commitment.

Earning Money with Emergency Fund Savings

Finally I suggested to her to make sure that her banking needs are being met, including having her savings actually earn a bit of interest. Whether you decide to use a brick and mortar option or go with online banking, find an account that works for you.

With an emergency fund you need to focus on 3 things:

  • Easy access to it in case of emergency
  • Safe place to store you money
  • A place where it can grow

Make sure the first two needs are met before you look at the third. for us we use both Ally Bank Online Savings Account and ING DIRECT  High Yield Savings for our funds.

Thoughts on Being a Working College Student

I’d love to get your thoughts and suggestions. How many of you had or are working while attending college? How did you manage your bills?

Ally Bank ® Online Savings Account

Photo Credit: scui3asteveo

VINE & LACE

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