A college budget doesn’t have to be complicated to work. In fact, the simpler it is, the better.
Here’s how to create a basic college student budget that will help you accomplish two things: One, you’ll be able to afford everything you need in school, and two, you’ll be ahead of the curve when you graduate, ready to budget for what you want in the working world.
Figure your projected income
Make a list of all of the income you expect to receive over the course of one academic year (for example, the 9 months you are in school during the fall and spring semesters). Include things like:
- Student aid (loans, grants, scholarships)
- Work-study income
- Wages from a regular job
- Support from your parents
If you saved up money the summer prior to the academic year and you plan to use it for college expenses, then include this in your projected income total, too.
Add up all of this income and divide by 9 (or however many months you will be in school). This figure represents your monthly income for the academic year.
Of course, if you don’t move home during the summer and support yourself all year long, then you’ll need to budget for the entire year. If that’s the case, you’ll need to divide your total income by 12.
Figure your estimated expenses by category
Make a list of all of the fixed and variable expenses you expect to incur over the course of one academic year. Below is a sample list of categories when considering budgeting for college students.
You’ll see suggestions for what percentage of your budget to spend in each category — keep in mind that these are suggested caps. Depending on what you need to spend in one category, you may need to spend less in another.
Tuition and fees
Look at your school’s cost of attendance for this figure. The average at a 4-year in-state school during the 2015-16 academic year was $9,410. (If you have student aid, you can expect funds to go directly toward tuition and fees before you receive your disbursement.)
- On-campus room and board
Look at your school’s cost of attendance for this figure, too. The average cost of room and board at a 4-year in-state school during the 2016-17 academic year is $10,440.
(If you have student aid, you can expect funds to go directly toward room and board before you receive your disbursement.)
- Off-campus housing
Ideally, you don’t want more than 30 percent of your income going toward rent or more than 10 percent going toward utilities and other household expenses.
Books and supplies
This figure will vary by class and major. The average at a 4-year in-state school during the 2016-17 academic year is $1,250.
This figure will vary depending on whether you have a car payment or not. Ideally, your car payment should represent no more than 10 percent of your income, and your car insurance and related expenses no more than 5 percent.
This figure will vary depending on your plan. The average monthly cell phone bill is $73.
Emergency savings fund
Aim to save 10 percent of your income for unexpected expenses.
If you live on-campus, meals are covered in room and board. That said, you should have a small budget for snacks, ordering in, and going out to eat now and then.
If you live off-campus, you’ll need to keep track of a full food budget, which should represent no more than 15 percent of your income.
This category should represent no more than 5 percent of your budget and include any fun you plan to pay for that’s not already covered under food (such as movies or concerts).
While you won’t be able to swing a new wardrobe, you can splurge on something new now and then. Just make sure it represents no more than 5 percent of your income.
This figure will depend on your mode of travel and how far.
Add up all of these expenses. If you used figures for the academic year, be sure to divide by 9 (or 12, if you are budgeting for a full calendar year). This will give you your monthly expense total.
Subtract your expenses from your income
Every month, you need to do one of two things — spend less than you earn or break even. Subtract your total estimated expenses from your projected income. If you’re in the negative, that’s how much you need to deduct from your college budget. Go through your variable expenses and cut where you can.
If you’re in the negative, that’s how much you need to deduct from your college budget. Go through your variable expenses and cut where you can.
Put your college student budget to the test
Now it’s time to see how workable your budget really is. For a full 30 days, track your spending in each category. Do the math at the end of the month and see how close you came to your target figures.
If you came up short, it’s time to tweak those numbers. In fact, if you broke even, there’s no reason not to try and do better so that you have some wiggle room. Revisit those variable expenses and rework what you can.
Of course, if you find yourself coming in way under budget, you might be getting more student aid than you need, and that’s only going to cost you in the long run. Here’s how to return student loans if realize you’ve borrowed too much.
Getting the basics of college budgeting down is one of the most important things you can learn before you graduate. Doing it on your own — in a spreadsheet or with pen and paper — is a great way to immerse yourself in it. But you can also be plenty hands-on with budgeting apps.
Your college budget is a work in progress
If your college budget doesn’t work the first time, that’s okay. (In fact, it’s normal.) Budgeting for colleges students is a work in progress. It takes time to create a budget that works just right for you. And even when you do, it won’t last forever.
Depending on how your life and priorities change, what works this year might not work the next. Be flexible enough to change it, disciplined enough to try it, and mindful enough to have fun.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 7.89% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.97% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate|
|2.47% – 6.97%1||Undergrad & Graduate|
|2.51% – 8.09%4||Undergrad & Graduate|
|3.02% – 6.44%2||Undergrad & Graduate|
|2.47% – 6.71%5||Undergrad & Graduate|
|2.79% – 8.39%6||Undergrad & Graduate|