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Posts Tagged ‘budgeting

 Bettter Budget Management for Students – Part-1

I received three questions in the last 2 weeks from Jim, Jones & Mark of US asking almost the same question of how we students should manage our budget during the current economic climate. Since this question is so important, I decided to answer this in a series of three posts. Please make sure that you read all three posts in series to get the full picture.

When I was a student, I always tried to get maximum for my bucks as it’s not easy to make a living and study at the same time. Most of the students do work for limited time only so that they can balance between their classes and job. I had the same situation and I was earning only minimum wages initially for all the jobs. I had good fun doing all these jobs but I always struggled to meet my expenses. One day my dad came to see me and he watched my schedule for couple of days and then asked me to join him for a dinner at a good restaurant. After dinner we went out for a walk and there he shared with me few cost cutting tips. I benefitted a lot and I am sure you too can.

Tip#1: Reduce your Housing Cost

Easier said than done! Right, I had the same feeling when my dad told me about this. We all know that housing is the biggest cost for any one including students. So how can you reduce this cost? Well for extraordinary results, you have to take extraordinary steps.

Here are some options for you:

1. Look for a place which is less expensive but well connected with public transportation so that you can attend your college or university with less hassles. In every city you will find some localities where rents go down a lot and check out these places if it suits you.

2. Do you have students from the same city or town in your school? Check out with them if they would like to share a house with you. You can also check with your buddies and classmates if they would like to share a room with you. Be practical but be fussy at the same time in deciding whom you will be sharing your room with.

3. Challenge yourself to downgrade your current living standards with more affordable ones! If you want to buy furniture, look for garage sales and many other places where you can get deals. Be more creative with your decisions and look for multiple use of your belongings.

The above tips helped me in reducing my housing cost a lot as I decided to move with my buddies. This not only saved me money but also provided me a wider social platform.

Some good blogs for your further reading:

 

I am sure you might have tried many other options. So I am looking forward for your ideas. Please share here with every one so that more people can benefit.

Thanks

Jay Author

I got this question from Noori of Seattle, US asking ‘how can I create my budget fast?’.

First of all, thanks a lot to Noori asking this very timely question especially in this current economic recession time. Secondly Noori you are not alone facing this problem. By saying this, I don’t want to say that it’s ok not to do your budget just because it seems so tedious. My job is to make it easy for you and for the blog readers.

When I was creating my first budget just after college, I had real tough time. I kept on putting this task away for too long. One day I was checking my account and then I realized that my savings are zero. I started thinking how can I get control on my finances. That’s when I started thinking of putting up a budget. So here are the tips which I learned the hard way but you can learn the easy way by reading and acting on this.

1. Collect all your bills for a month and then put these bills in different categories like utilities, grocery, rent, etc. You should make sure that you creat your own categories which work for you. Here is a watch-out for you, don’t be too overconfident of yourself in the beginning that you can manage this system. So keep the system as simple as you can. Make it intuitive for you.

2. Once you complete putting all the expenses in their categories, add up the bills and see how much money you need to allocate for that category. While doing this exercise, you should challenge yourself for cutting the unnecessary expenses. Be realistic and start with a budget which you can live with.

3. Once you are ready to put your system to test, implement it for a month. At the end of the month, review your sum of the expenses and see if you are within your budget or out of budget. Target only that category first where you are busting your budget. Review it carefully and see how can you reduce your expenses. Be creative and see opportunities for reducing your expenses.

4. Check the expense for each category again and see how you did for your target category. If you achieved your target, then reward yourself with something which you enjoy. Don’t overspend just go for affordable ideas. This step is very important.

5. Over the time you will fine-tune your budget and review it every month. And as you achieve your targets every month, you will be more confident for the bigger challenges.

6. So what’s the big challenge? Now it’s time for looking for room to start saving money. You were really creative when you started reducing your expenses by using out of box ideas. The same creativity will help you again. Start with a small saving target.

7. Stick to your budget and start saving money!

So isn’t it easy to put up a budget? Well that’s the fact but implementing it is the real challenge. You should look for help from your spouse or friends or relatives who can be part of your budget review and can monitor your performance. If you can’t manage yourself well, then let others help you manage your financial actions.

For those computer-savvy readers, I am sharing some resources here:

 Jay Author