The Essential College Financial Checklist

As you begin your college career, you’ll likely be heading out on your own for the first time. That means the days of free room and board or meals cooked by Mom are gone, and you’ll have to manage your own finances. To ease your transition into financial independence, be sure to check off the following items from your financial checklist.

  • Understand your financial aid package

You’ll likely be using some financial aid to cover school costs, including tuition and fees, room and board, books and supplies, and transportation. Knowing how much of your college expenses your aid package actually covers will help you make decisions on how much to save and how to budget accordingly. Financial aid includes:

1. Need-based aid is calculated by subtracting your expected family contribution from the cost of attendance at the school, which is information you submit on the FAFSA form. The difference is the amount you are eligible to receive. Federal need-based aid programs include:
• Federal Pell Grants
• Subsidized Stafford Loans
• Perkins Loans
• Federal Supplemental Educational Opportunity Grants
• Work-study
2. Non-need-based aid does not take your financial need into account. It is calculated by subtracting your financial aid awarded so far, such as scholarships, from the cost of attendance. Federal non-need-based aid programs include:
• Unsubsidized Stafford Loans
• PLUS Loans

Be sure to fill out the FAFSA to see what kinds of financial aid you may be eligible for, even if you think your family makes too much money to qualify.

  • Open a credit union account

Opening your own checking account will help you establish financial autonomy and responsibility. Especially if you are attending college away from home, you’ll need to be responsible for purchasing your own necessities. When choosing a new account, look for these:

• Low or no monthly fees
• Mobile and online banking features
• Easy access to surcharge-free ATMs on or near campus (Hopewell FCU members can use Alliance One or Pulse ATMs for free)

A checking account will make your financial aid disbursement easy, since you can set up direct deposit with your school. With direct deposit, you’ll have access to your money faster, and you’ll also avoid paying any check cashing fees. It’s also a good idea to open a savings account and set aside an emergency fund instead of relying on a credit card if an unexpected expense pops up.

  • Open a credit card

Opening a credit card can help you build credit, which you’ll need when it comes time to rent an apartment or buy a house or car. Keep in mind that if you’re under 21, you’ll need someone to co-sign for your credit card. Make sure to open only one and treat it like a debit card. Use only as much money as you actually have in your checking account and pay it off each month.

  • Make and follow a budget

Schoolwork aside, budgeting may be your most important assignment. Determine where all of your money will go, so you can save and prevent racking up unwanted debt. You can either create your own budget or use a budgeting app. If you choose to create your own budget, pick a time frame for it (monthly is usually easiest), and follow these steps:

1. List your income
2. List your expenses
3. Consider how much you would like to put into savings for emergencies or a big-ticket item
4. Subtract your total expenses (including savings) from your total income and make sure it balances – you should either break even or have some money left over

If your budget doesn’t balance, find where you can cut spending or increase your income.

Cherise Fantus, NerdWallet

 

 

 

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