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Online Banking

How to Budget as a College Student

Budgeting as a college student is more critical than ever, especially given the rising education costs. According to a 2023 report by Sallie Mae, families reported spending an average of $28,026 on college for the academic year 2022-23, an 11% increase from the previous year. This blog will guide you through budgeting as a college student, focusing on the 50/30/20 rule and how to manage your finances effectively, along with tips and tricks for effectively managing your money. After all, those midnight snacks and takeout nights aren’t impossible- they just have to be done wisely.

College budget blog Oct 1

Why Budgeting is Important as a College Student

With families covering half of their college expenses out of pocket, learning to budget is essential for financial well-being. A study conducted in 2020 found that there were 3% fewer full-time undergraduate college students were employed (40%) compared to 43% in 2015, compared to 81% of part-time students in 2018 versus 85% in 2000. In addition, the average income for an 18-22-year-old is around $15-18 an hour, compared to the median average across the US, $30/hour.

Depending on your unique situation, you're probably not swimming in cash right now between classes, extracurriculars, and helping out at home. That's why it's crucial to get smart about budgeting what you do have. The upside? College life might actually give you a bit of a break with fewer bills. So, now's the perfect time to master managing your money.

1. Financial Awareness

Budgeting helps students understand their financial situation, including income sources, fixed expenses, and variable costs. This awareness is the first step toward financial responsibility.

2. Avoiding Debt

With the rising education costs, students are more likely to incur debt. According to a 2023 report by Sallie Mae, families spent an average of $28,026 on college for the academic year 2022-23. Budgeting can help students minimize the amount they need to borrow, reducing future financial burdens.

3. Prioritizing Expenses

College life comes with various expenses, from tuition and books to social activities and personal needs. Budgeting helps students prioritize essential costs over discretionary spending.

4. Building Good Habits

Learning to budget in college sets the foundation for good financial habits that will benefit students throughout their lives. It teaches essential skills like saving, investing, and living within one's means.

5. Emergency Preparedness

Having a budget allows students to set aside money for unexpected expenses, such as medical emergencies or urgent travel, reducing financial stress during challenging times.

6. Achieving Financial Goals

Whether saving for a car, a study-abroad program, or even post-graduation plans, budgeting helps students set and achieve financial goals.

7. Enhancing Financial Literacy

Budgeting is an educational experience that enhances financial literacy. It teaches students about interest rates, the importance of credit scores, and the benefits of saving and investing, which are valuable life skills.


Types of Common Income and Expenses

  • Total Income:  Money from family, financial aid, and work.
  • Monthly Income:  Recurring funds earned each month.
  • Fixed Expenses:  Necessities with consistent prices (e.g., rent, utilities).
  • Variable Expenses:  Monthly costs vary (e.g., eating out, entertainment).


How to Budget in College: A 3-Step Guide

1. Break Down Your Total Income

First, you need to know how much money you're working with. This isn't just about that part-time job you've got; it's the financial picture.

  • Family Contributions
    If your parents or other family members are helping you out, add that to your total income.
  • Financial Aid
    This includes scholarships, grants, and loans. Just remember, loans have to be paid back eventually!
  • Part-time Jobs or Gigs
    Whether you're working in a coffee shop or freelancing online, this is probably your most regular source of income.

Add all these up to get a clear idea of your monthly income. This is your financial playground—let's make the most of it!

2. Assess and Categorize Your Expenses

Now, let's talk about where that money is going. You'll want to list out all your expenses and split them into two categories:

  • Needs:  These are your non-negotiables. Think rent, tuition, groceries, and utilities.
  • Wants:  This is the fun stuff—eating out, concerts, shopping sprees, you name it.

Knowing the difference between the two is key to not blowing your budget.

3. Crunch the Numbers

Time for some basic math. Take your total monthly income and subtract your total monthly expenses. If you end up with a positive number, you're doing great! If it's negative, don't freak out—this is your wake-up call to cut back on some of those "wants" or find ways to boost your income.

4. Create a Budget Using the 50/30/20 Rule

Now your income and expenses are laid out, so what's next? It's time to make a budget that you can actually stick to. The 50/30/20 rule is a solid guideline:

  • 50% on Needs
    Half of your income should cover the essentials like rent, food, and bills.
  • 30% on Wants
    This is your fun money, but keep it within limits.
  • 20% into Savings or Debt Repayment
    Future you will thank you for this. Whether saving for a rainy day or paying down a student loan, make this a habit.

And there you have it! You're now armed with the basics to take control of your financial life in college.


Tips for Saving Money

  1. Rent Textbooks:  Save money by renting textbooks or buying e-books.
  2. Cook at Home:  Cut costs by cooking at home instead of eating out.
  3. Use Student Discounts:  Many businesses offer student discounts on various products and services.

Tools for Budgeting

  • Budgeting Apps:  Apps can help you track your spending by connecting directly through your bank account(s), credit cards, and more!
  • Spreadsheets:  Use Excel or Google Sheets to create a detailed budget.
  • Banking Apps:  Your bank, such as FNCB Bank, often has a convenient app to manage your checking and savings accounts in one place. Some apps have capabilities for automatic bill pay, allowing you more control and flexibility in making payments on time. These banking apps may even offer discounts or coupons to get the best deals at places you’re already shopping, even in the form of cashback directly in your account.

College budget blog Oct 2


Best Student Checking Account in PA, NY, & NJ

If you're a college student or resident in Pennsylvania, New York, or New Jersey, it's worth considering specialized student checking accounts to manage your finances. One option is FNCB Bank’s Student Checking account, tailored for students between the ages of 14-25 or those still enrolled in school. This account is particularly convenient for students who are always on the go, offering easy mobile and online account access that you can take with you, no matter where your educational journey leads.

What sets our Student Checking Account apart from others are its student-friendly features. There's no minimum balance requirement, so you don't have to stress about maintaining a certain amount in your account. You'll also receive a free debit card with access to 55,000 surcharge-free ATMs on the Allpoint Network. On top of that, the account comes with a free mobile app, free online banking, free account alerts, and free bill pay. Need to deposit a check or send money quickly? No problem—mobile check deposit and Zelle® are also included. With all these features, FNCB Bank makes managing your finances convenient and cost-effective.

Contact us today or visit one of our 16 branches across Northeastern Pennsylvania today.

Mobile Banking Made Easy with FNCB Bank's App

FNCB ap logo

FNCB Bank offers a convenient mobile banking app available on the App Store and Google Play for Apple and Android/Google devices. Manage your balance, deposits, checks, bill pay, discounts, and more, all from the comfort of your home. Have control over your finances 24/7 and feel secure when it comes to budgeting as a college student. 

Download FNCB Bank's App on the Apple App Store

Download FNCB Bank's App on Google Play


With the average annual cost of college hitting $28,026, understanding how to manage your money is more than just a good idea; it's essential for your financial well-being.

We've covered everything from knowing your income and expenses to setting up a budget that works for you. And remember, this isn't about cutting out all the fun from your life. It's about ensuring you can enjoy those late-night snacks and spontaneous outings without worrying about money later.

With all the tools and tips we've discussed, like budgeting apps, spreadsheets, and even features from your bank's app, you've got everything you need to take control of your finances.

Our Mission: To make your banking experience simple better.

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