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Getting Your Finances In Order Before You Get to Campus

LAST UPDATED Aug 22, 2024
Daniel Bod

Categories: College Life

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You’re about to embark on one of the most exciting adventures of your life – going away to college! Before you dive into the deep end of dorm life, let’s talk about getting your finances in order. This is an overview of how to get your finances in order before college, and what you’ll need to get started on your path to financial independence – including information about bank accounts, credit cards, and budgeting.

Bank Accounts

First things first, you’ll need a bank account in your own name. Yep, this is your moment to shine as a financially independent adult! Look for a bank that has a branch on or near campus or at least an ATM that doesn’t charge withdrawal fees. You don’t want to be hit with those pesky fees every time you grab some cash for late-night pizza runs or coffee fixes during finals week.

Having a local branch can be a lifesaver when you need to handle any banking issues. Plus, it’s always nice to have somewhere you can physically go if you need help.

Opening a savings account, especially a high-yield savings account (HYSA), can be a game-changer for college students looking to get a head start on their financial future. Unlike regular savings accounts, HYSAs offer significantly higher interest rates, meaning your money grows faster just by sitting there. This is an easy way to make your money work for you while you’re focusing on your studies. Setting up regular deposits into your savings can help you hit long-term milestones, like saving for a summer internship, a study abroad program, or even starting your post-graduate life without the stress of financial uncertainty. Plus, having a dedicated savings account encourages disciplined financial habits that will benefit you well beyond your college years.

Some popular banks for college students include Capital One and Bank of America, but check what’s available around your campus.

Student Credit Cards

Now, let’s talk about credit cards. It might sound a bit scary, but having a credit card in your name can actually be super beneficial. It’s a great way to build your credit history, which you’ll need later for things like renting an apartment or buying a car. Plus, it can help you learn responsible spending habits.

However, it’s crucial to remember that late payments can lead to hefty fees and high interest rates that quickly accumulate, potentially putting you in a financial hole that’s hard to climb out of. Missing a payment not only impacts your wallet but also damages your credit score, making future financial endeavors more challenging and expensive. Additionally, carrying a balance month-to-month means you’re paying more for everything you charge due to the compounding interest, which can make even small purchases significantly more costly over time. So, while credit cards are a powerful tool, they require careful and disciplined use to avoid falling into debt traps.

What are student credit cards and how do they work?

A student credit card is specifically designed to help students build credit while still in college. Think of it as a regular credit card’s cooler, more student-friendly cousin. They usually come with lower credit limits, no annual fees, and a bunch of sweet perks like cashback rewards and student-specific incentives. Use it wisely, and you’ll be setting yourself up for a solid financial future!

What’s the difference between a student credit card and a regular credit card?

Here’s the deal – since you’re just starting out with little or no credit history, student credit cards are a bit more forgiving than regular credit cards. They tend to have lower credit limits and higher interest rates than regular credit cards, but also often come with student-friendly perks like rewards for good GPAs, free credit reports, and financial education tools to help you learn the ropes. It’s like having training wheels for your financial bike!

Do I have to be a student to get a student credit card?

Most of the time, yes, you’ll need to prove you’re enrolled in college to snag one of these cards. Requirements can vary, but generally, you’ll need to be a US citizen, at least 18 years old, and able to show some proof of steady income. Think of it as part of the initiation into the student credit card club.

Can a student get a credit card with no job or income?

While there’s usually no strict minimum income requirement, credit card companies want to be sure you can make on-time payments. You might be able to get a student credit card even if you only make around $500 a month after expenses like rent and utilities. If you have no income at all, don’t worry – you still have options. You can look into becoming an authorized user on a parent’s card, or explore other ways to build up your credit until you land that part-time job or side hustle.

When choosing a student credit card, look for one with no annual fee, a low-interest rate, and some sweet perks like cashback or rewards points. According to Earnest, some of the best student credit cards include:

  1. Capital One Quicksilver Student Cash Rewards Credit Card: Earn unlimited 1.5% cash back on every purchase, every day. $0 annual fee. Plus, earn a $50 cash bonus.
  2. Capital One SavorOne Student Cash Rewards Credit Card: Earn unlimited 3% cash back on dining, entertainment, popular streaming services & at grocery stores. $0 annual fee. Plus, earn a $50 cash bonus.
  3. Bank of America® Travel Rewards Credit Card: Earn unlimited 1.5 points for every $1 you spend on all purchases everywhere, every time. No annual fee and no foreign transaction fees.

Remember, only charge what you can afford to pay off each month. This isn’t free money; it’s a tool to help you build your financial future.

Budgeting: Your Financial GPS

Creating a budget is like setting up a financial GPS for your college journey. You need to know where your money is going so you don’t end up stranded. Budgeting might seem a bit scary at first, but it’s really just a way to plan how you’ll spend your money each month. Once you know what’s coming in (like how much you’re earning), you can manage your spending more effectively. 

There are tons of ways to create a budget, but if you’re a beginner who wants to manage money on-the-go, follow some of these practical budgeting tips:

  1. Track Your Spending: Use an app like Goodbudget, Mint or Dollarbird to keep an eye on where your money is going.
  2. Set a Monthly Limit: Allocate a certain amount for non-billed living expenses like food, entertainment, and personal items.
  3. Include a Buffer: Make sure to include a little extra in your budget for unexpected expenses. Life happens, and it’s always better to be prepared.
  4. Prioritize Needs Over Wants: Focus on essentials first. Ramen is cheap, but you still need to budget for those occasional nights out or fun activities.
  5. Save Where You Can: Look for student discounts, buy used textbooks, and cook at home instead of eating out all the time.
  6. Review Regularly: Check your budget each month and make adjustments as needed. If you overspend in one category, try to cut back somewhere else.

Final Thoughts

Getting your finances in order before you get to campus might seem like a chore, but it’s a crucial step toward becoming a financially savvy adult. With the right bank account, a smart approach to credit cards, and a solid budget, you’ll be well on your way to acing your financial life as a college student.


Disclaimer: This blog post provides personal finance educational information, and it is not intended to provide legal, financial, or tax advice.

Daniel Bod
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