How to Create a Student Budget in 5 Steps

Here’s how to make a budget that works for college life:

1. Know Your Income: Add up all money sources (part-time jobs, financial aid, etc.)
2. List Your Expenses: Track everything you spend for a month
3. Set Money Goals: Choose 2-3 priorities (e.g. emergency fund, graduate debt-free)
4. Make Your Budget: Pick a method (like 50/30/20) and allocate funds
5. Check and Update: Review monthly, adjust as needed

Why budget? It helps you:

• Avoid unnecessary debt
• Build savings
• Sleep better at night
• Learn money skills for life

Quick monthly budget breakdown for students:

Total: About $2,900/month

Remember: Your actual costs may vary. Track your own spending to create a personalized budget that works for you.

Related video from YouTube

Know Your Income

Let’s start with the basics: how much money are you bringing in?

Where’s Your Cash Coming From?

As a student, you’ve got options:

• Part-time gigs: Think coffee shops, libraries, or retail. Hourly rates vary, but you could make anywhere from $11 to $30 an hour.
• Campus jobs: Your school might have openings for TAs, research assistants, or tutors.
• Work-study: If you’re on financial aid, this could be your ticket. In 2019, students averaged $1,808 from these programs.
• Internships: Paid internships are gold. They fill your wallet AND your resume. Plus, nearly two-thirds of paid interns landed job offers after graduation in 2019.
• Side hustles: Freelancing, online selling, or market research studies can pad your income.

Crunch the Numbers

Time to add it all up:

1. For hourly jobs: (Hourly rate × Weekly hours × 52) ÷ 12
2. For salary: Yearly amount ÷ 12
3. For irregular income: Average your earnings over a few months

Add everything together. That’s your monthly income.

Pro tip: Focus on your net income – what you actually take home after taxes and deductions.

Now you know what you’re working with. Next up: figuring out where it all goes.

2. List Your Expenses

Now that you know your income, let’s figure out where your money goes. Here’s how to break down and track your expenses:

Types of Expenses

Students have costs beyond tuition. Here’s what to account for:

• Housing (dorm fees or rent)
• Food (meal plans, groceries, dining out)
• Books and supplies
• Transportation
• Personal items

Here’s a snapshot of average monthly costs:

Your actual expenses may differ, but this gives you a starting point.

Track Your Spending

Keeping tabs on your spending is crucial. Here are some ways to do it:

1. Bank statements: Check monthly for spending patterns.

2. Spreadsheets: Use Excel or Google Sheets to log expenses.

3. Budgeting apps: Connect to your bank accounts for real-time tracking.

4. Expense categories: Group spending into needs, wants, and savings/debts.

"Try to put even a small amount of money – $10, $15, $20 – into savings each time you get paid." – Jim White, dean of student financial services at Gonzaga University

Pro tip: Track your expenses for a month. This will give you a clear picture of your spending habits and help you create a more accurate budget.

Some expenses are fixed (like rent), while others are variable (like food). Knowing this difference helps you find areas where you can cut back if needed.

3. Set Money Goals

Setting clear money goals is crucial for students. Here’s how to do it:

Short-term and Long-term Goals

Think about what you want:

• Short-term: Achievable within a year (textbooks, spring break)
• Long-term: Bigger goals (paying off loans, buying a car)

"My goal is to build my emergency savings back up to 6 months of living expenses within 2 years." – Olutoye A., Voorhees University

SMART Goal Setting

Use SMART to make your goals stick:

"A financial goal I hope to accomplish shortly because of this is to have at least $6000 in savings by next December to ensure I can put myself through this program with no financial stress." – Anika C., University of Central Florida

Choose Your Top Goals

Focus on 2-3 goals:

1. Start an emergency fund

Aim for $1,500 to $2,000.

2. Track your spending

Use apps like Kora to see where your money goes.

3. Graduate debt-free

"My next financial goal is to save and earn enough to graduate college debt-free." – Kaden S., Cedarville University

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4. Make Your Budget

Time to create your budget. Let’s pick a method and divide your cash.

Pick a Budget Method

Choose a budgeting style that works for you:

1. Zero-based budget

Every dollar has a job. Here’s an example:

2. 50/30/20 budget

Split your money into three buckets:

• 50% for needs
• 30% for wants
• 20% for savings and debt

3. Envelope system

Use physical or digital envelopes to divide your spending money.

Divide Your Money

Now, let’s allocate your funds:

1. List your income sources

• Part-time job
• Financial aid
• Family support

2. Write down all expenses

• Fixed costs (rent, tuition)
• Variable costs (food, fun)

3. Allocate money to each category

Here’s how $3,500 monthly income looks with the 50/30/20 rule:

4. Track your spending

Use apps or spreadsheets to keep an eye on your money.

5. Adjust as needed

Check your budget monthly and tweak based on real spending.

5. Check and Update Your Budget

Keeping your budget fresh is crucial. Here’s how:

Look at Your Budget Often

Check it monthly. Why? You’ll:

• Catch overspending early
• Adjust for income or expense changes
• Stay on track with goals

"Monthly budget checks give you all these benefits. Try it and see what happens."

Tight on cash? Review your budget every payday.

Save for Surprises

Unexpected costs happen. Build an emergency fund:

• Set aside a bit each month
• Use apps like Mint or YNAB to track progress
• Aim for at least $500 to start

Ways to Spend Less

Cut common student expenses:

Pro tip: Always ask about student discounts. Many places offer them, but don’t advertise.

Conclusion

Let’s recap the 5 steps to create a student budget:

1. Know Your Income
2. List Your Expenses
3. Set Money Goals
4. Make Your Budget
5. Check and Update Your Budget

Following these steps isn’t just about managing money – it’s about building life skills. A solid budget helps you:

• Spot the difference between needs and wants
• Live within your means
• Dodge unnecessary debt
• Build a savings habit

Remember: Budgeting is an ongoing process. As your life changes, so should your budget.

Here’s how budgeting can impact your college life:

FAQs

What’s a good monthly budget for a student?

For the 2024-2025 school year, college students should plan for about $2,900 per month in living expenses. That’s roughly $26,400 for nine months of school, according to the College Board.

Here’s a quick breakdown:

How do I create a student budget in 5 steps?

1. Track your spending: Write down EVERYTHING you buy.
2. Set goals: What does "budget success" mean to you?
3. List income and expenses: All money in, all money out.
4. Make your budget: Pick a method and divide up your cash.
5. Keep an eye on it: Check and update your budget regularly.

What’s a good way to budget as a student?

Try the 50/30/20 rule:

• 50% for needs (rent, food, bills)
• 30% for wants (fun stuff)
• 20% for savings and paying off debt

Let’s say you’ve got $1,000 a month:

It’s simple, but it works for a lot of students.

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