THE 7 WORST FINANCIAL MISTAKES COLLEGE STUDENTS CAN MAKE
1.) NOT FILLING OUT THE FAFSA
Filling out the Free Application for Federal Student Aid (FAFSA) should be your first step to help you pay for college. Students who skip this critical first step of their college journey are missing out on potential grants, scholarships and subsidized loans. This mistake is an easy one to avoid — just go to FAFSA.gov and get your form filled out! Ah, the budget… The start of a new school year should begin with a budget that includes a breakdown of all monthly bills, expenses, groceries, and an emergency fund to cover unexpected expenses. And yet, many students fail to implement the art of budgeting into their daily lives. College is the best time to build good budgeting habits that can benefit you beyond college. Come up with a budget and stick to it — you’ll be glad you did when it comes time to pay the bills.
2.) DON’T OVERPAY FOR COLLEGE
Does the name of the school on your diploma matter? In some cases, yes it does. In other career paths, perhaps not so much. Many students dream of going to a prestigious school or head out of state, but this may not be the best decision financially. With some degrees, it may not matter as much where your degree comes from so spending an extra $100,000 on a degree may be wasteful.
Choosing a less expensive public university or attending a community college for the first two years then transferring may be the better option, cost-wise. Before enrolling in your dream school, consider what the true return on investment may be. Take time to explore other options and see if a prestigious school is the only way to pursue your chosen career path. You may find that a different school proves to be the better bargain and in doing so, you'll position yourself to begin your professional career with less student debt.
3.) ACQUIRING CEDIT CARD DEBT
If you pay attention, you will see that credit card companies are everywhere around the campus! These companies are ready to offer students that are not literate about finances credit cards that provide a possibility to purchase things now and pay for them later. The offer is tempting, but the cards offered may not be that good of a deal, having high interest rates and multiple layers of hidden fees. And the damage becomes noticeable only when it is too serious, affecting both your financial status and your credit rating for years to come. Credit cards should not be used to splurge or to fill in the gaps within your budget. Credit card debt generated during college can affect your credit score for years to come. Ultimately, it can hurt your chances of getting things like a car loan or mortgage down the road. Spend wisely and always pay on time.
4.) ABUSING STUDENT LOANS
Student loans are usually offered at favorable terms that fit in a borrower’s needs and possibilities, but those who take on student loans can get into financial trouble pretty quickly. Statistics say that the total amount of student loans debt in America is about $1 trillion, which is more than credit card debt. The trouble with student loans is that the universities and colleges will typically never say no to your borrowing, and so you can take out as much as you want — even if you will have no hope of ever repaying the loans. As such, it’s important that you really consider the costs of repaying the loans when you take them out. A rule of thumb is to avoid borrowing more for school than you plan to make in your first year after college. Researching potential jobs and salaries will give you a good reference point.
5.) DON’T OVERSTAY
Many students at the end of their studies still feel they are not ready to go and fight with the big and scary world, and prefer to stay in grad school and not leave the college. Sometimes it can really pay off, but usually such decisions work against the student — creating an even deeper debtor’s prison that would be hard to break out from. Students should be working toward what they need in school, and should go for the quickest way out. Being in a program for six or seven years doesn’t make a lot of financial sense. Skipping out on class may seem more like a personal bad habit than a financial one, but the fact is your time in the classroom costs money. When you don’t give your education your all, you’re squandering an important investment in your future. This can increase your chances of not passing a class, which can affect your graduation eligibility, FAFSA and loan requirements, and student organization participation. Staying committed to your studies is overall a financially smart move. However, you don’t get a refund if you fail. Instead, you have to pay to take the class… again.
6.) SOME THINGS IN LIFE ARE FREE
One of the biggest perks of being a college student is the array of discounts and freebies that become available to you. Avoid paying for items you can get for free. Pass on the expensive, monthly gym membership and take advantage of the campus gym. Skip your weekly trip to the movies and check out the free movie nights on campus. Keep an eye out for what’s available and put your student status to good use.
7.) PROTECT YOUR PERSONAL INFORMATION
Statistics say that a third of all identity theft is happening to people between 18 to 29 years of age, and the reason for this is their carelessness toward their personal information and sharing their personal information with their friends and roommates. Logging on to your financial account on public computers, using common areas for private banking info, and the mass use of all social media accounts helps predators find your personal information and can lead to identity theft. Be careful with your personal ID, passwords, and other information.
Hope this was Helpful Bao-Truc