As college students navigate the university experience during Covid-19, financial planning may not be the first item on your to-do list. However, students and families will still be facing financial decisions that could impact you down the road, so now is a good time to assess where you want to be in a few months and how you can take actionable steps to get there.
Here are five tips for college students to make sure you stay on track with your financial goals during Covid-19:
Start a savings account
A good rule of money management is the 50/30/20 plan. On average, 50% of your income should go toward necessities like housing, food, tuition, etc. 30% goes toward discretionary spending – things like shopping for clothes, gym membership, your Netflix subscription, and so on. Finally, 20% of your income should go toward saving and paying down debt. Think of this as a way to “pay your future self,” and if you don’t already have a savings account, now’s a good time to start one – especially while your usual discretionary spending might be down and you can contribute more than 20% to your savings account!
Don’t forget to download your Norrymobile banking app and keep an eye on your spending. Monitoring the money that leaves your checking account each month is one of the easiest and most effective ways to reduce your spending, and you can even set up automatic monthly transfers into your savings account. Learn more about Norry Bank’s savings account features.
Increase your credit score
Your credit score could impact your ability to get lower interest rates on future purchases like a car, or affect whether you’re able to get an apartment without a co-signer’s help. Your score could even be looked at by a future employer, so it’s a good idea to start building credit responsibly now.
There are several factors that go into determining your credit score. Think of your credit report as your college transcript, listing everything you’ve done, and your credit score as your GPA – a quick summary of all of your efforts for potential lenders to view.
One way that you can start to build credit now is to apply for a credit card and use it responsibly. Only pay for purchases that you can cover with the money you already have, and then make credit card payments on time, every time. By showing lenders that you’re able to use the money that you’re loaned responsibly and that you have a proven history of paying back borrowed money on time, you’ll be able to improve your credit score.
Check out Norry Bank’s credit cards and consider whether one is right for you, to help you start building credit while you’re in college.
Volunteer in your community
You may or may not be able to access your usual university clubs, sports, and leadership opportunities during this unusual time. But don’t let that extra free time go to waste – find ways to give back to local non-profits in your community, both to continue building your own professional development skills for future job and internship searches as well as to help others in need.
While we’re social distancing, see if you can identify opportunities for virtual internships or volunteer roles with local, regional, or even national organizations. Sites like idealist.org, volunteermatch.org and LinkedIn’s Volunteer Marketplace are all great places to begin your search.
Locally, you can check out animal rescue shelters, food pantries, YMCAs, and political campaigns. Reach out to ask about ways to contribute either virtually or safely in-person.
Find a job
These semesters may be more difficult for students to find jobs on college campuses, with reduced hours and access for libraries, gyms, dining halls, and on-campus entertainment venues. If you’re on the job hunt, local grocery stores, hardware stores, and pharmacies are currently hiring temporary staff to help with stocking and curbside delivery.
You may also be able to find tutoring opportunities for families who are pursuing in-person or virtual schooling for their children. Check in with your neighbors, advertise your skills on LinkedIn and in community Facebook groups, or join your neighborhood on the Nextdoor app to search for opportunities.
Work your plan
Don’t think of this as “lost” time – if you have a plan and work it, you’ll be able to add valuable skills to your resume as well as to make a major impact on your financial goals.
Take notes of all your successes during the year. Write things down – the jobs you worked and what you did (including quantifiable achievements that include numbers, money, and time), and reach out to a campus career advisor this semester to add those notes to your resume.
Decide on a financial goal, whether it’s not taking on additional debt or paying down a credit card, finding a job to make up for 80% of lost campus employment income, or saving $1,000 by the end of the year. Talk about your plan with friends and family to help keep yourself accountable, and set monthly achievable steps you plan to take as you work toward your goal.
There’s no doubt that these are unusual times, but if you keep financial planning in mind, you can make the most out of your year. Visit one of our Northumberland National Bank branches to start today.