Having a budget, especially while in college or at a young adult age, can be considered important for many different reasons; and depending on whom you ask, some might even say that it is essential to practice budgeting while in college, at least to some degree. Creating and maintaining a budget benefits individuals by learning how to spend their money responsibly. According to the Federal Student Aid, An Office of the U.S. Department of Education “Budgeting will help you build decision-making skills and reach your financial and academic goals.”
There are many benefits to owning and maintaining a budget but having achievable goals and a desired financial circumstance go hand in hand when planning a budget. Just like it’s a crucial aspect to set goals for accomplishing anything with personal significance, having a goal in mind for a future outcome is probably the most important step in creating a budget. But why would a college student worry about a budget if they are pursuing a college degree, with or without external financial responsibilities?
A great reason for college students to take advantage of budgeting before their launch into a career is that dealing with money is something that every individual will have to do at some point in their life. Practicing budgetary standards in college will provide a solid base of understanding for when financial situations arise later in life whether it be in a career field, family situations, or even after retirement. It’s essential to be able to understand how money works and how to use it, especially when it’s hard-earned income or money that should “stay in the family” (or be saved).
To provide further perspective on the “why?” factor behind creating a budget while in college, consider that college students share a common goal of earning a degree or some sort of higher education, and that goal can be achieved through discipline and action. A budget works the same way and for the same reason. Having a goal in mind in terms of a financial outcome is a major component of creating a realistic, effective financial plan (or budget); and just like earning a degree with the intention to set up future opportunities, a budget can have very similar, if not the same results. “Budgeting makes it easier to plan, to save, and to control your expenses,” according to the Federal Student Aid.
The gist here is that all students may have different life circumstances, but there’s at least one thing that everyone has in common, and that is: no one gets to own anything for free. Because finances are an aspect of life that will always be present for every person, getting a head start on the habit of managing money may be one of the greatest decisions a college student can make. After college, another phase of life begins, and that phase of life introduces a much heavier load of responsibilities regarding finances, life decisions, and obligations. There’s nothing anyone can do to predict the future but preparing for the future is a different story. A budget allows anyone to prepare for their financial future, and how can that be considered a bad idea?
There are many different sources of information that help people learn and understand how to create a budget as well as how to manage it. A great start to creating an effective budget, after already having a goal(s) in mind, is to assess the difference between “wants and needs.” Once priorities are established, it becomes simple to categorize expenses and begin to plan. A budget is something anybody can do just by simply assessing their situation and spending habits and from there, it’s all up to discipline and action.