Having financial foresight is beneficial for college students whether or not having to worry about finances. Some students may be supported financially but some others may not so lucky. Hence, it is always advised to play smart in managing finance. Also, managing your own money since college is a great investment to help improve your financial literacy and skill.
Most common financial mistakes college students do
It is pretty common for college students to have a bumpy roads once they enter a world of college. It is normal to stumble in managing your finance for the first times. Here are are some of the most common financial mistakes most students do you need to avoid:
College expense is already high. Overspending will only add to your financial burden. Having no control over your finance will lead to disaster, especially if you lack of financial support. Most common overspending done by college students include buying designer clothes, luxury watches, premium shoes, etc. Have more control and hold the impulse to buy unnecessary stuffs.
Having no emergency funds
Emergency fund is essential for anyone including college students. Even if your college-related expenses are already covered, there is still possibility for you to face the unexpected. Hence, it is a must to have an emergency fund just in case you get into unpredictable circumstances. It is a financial safety cushion to soften your landing during the unthinkable crash.
Misusing instant loan apps
There are loan apps that offer instant money college student can borrow without collateral. However, It is not recommended to borrow money from instant loan apps because you may end up with high debts. Choose another loans to help cover your college expenses with lower interest rates.
Using multiple credit cards
It is convenient to have your credit cards ready when you need to pay for something. Not to mention that having a credit card allows you to build your credit score, making it possible for you to apply for personal loans later when needed. However, using multiple credit cards is not a wise decision to take. You will be overwhelmed with how you are going to make monthly payment. You may end up not being able to handle it all.
Following the herd blindly
Peer pressure is one of the reasons why many college students overspend. They want to keep up with their mates so they force themselves to buy or do something beyond what they can actually afford to. Be yourself and have financial prudence for better money management in college.
Making unsound investment
Investing your money in something is great idea since it is more encouraged to do it early. However, be mindful of misguided investment. Build self-education and awareness before investing in something such as cryptocurrency which is known to be promising but volatile and risky. Read as much as you can and talk to others who have expertise in crypto investment. Aside from cryptocurrency, you can also invest in other types of assets be it digital or physical.