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College is the first time that many students will be living away from home and learning how to manage their own money. With the rising costs of higher education, college may not be the ideal time or place to squirrel away a substantial sum of money. After all, tuition, books and late-night pizza deliveries can really add up.
But that’s not to say it’s impossible to put a little away in your savings account every month to help you reach your financial goals.
Here are three strategies for those trying to save money in college.
1. Open a high-yield savings account. By the time you get to college, you may already have a checking account in place. And if your parents have drilled the importance of saving money regularly into your head, you may already have your own basic savings account. But now that you’re on your way toward adulthood, it’s time to think about graduating to a high-yield savings account.
According to the FDIC, the average rate for a savings account is at 0.09% APY. A high-yield savings account, on the other hand, could get you a better rate. And check out our savings calculator to see how much faster your money can grow in a Marcus high-yield Online Savings Account.
2. Make savings automatic. Hey, every little bit counts. You don’t have to wait until you’ve hoarded a large chunk of money in your checking account before putting some of that money into savings. Thanks to automatic deposits, you can take a more hands-off approach to saving money.
Automatic deposits let you schedule recurring deposits to your savings account – you just have to say when and how much. By stashing a little away every month, you can see your savings grow over time thanks to the power of compound interest. Automating your savings also means one less thing for you to think about in school. Now you can fully focus on learning exactly why the mitochondria is the powerhouse of the cell.
3. Bring some clarity to your money. Making a budget may help increase your chances of reaching your savings goals. A budget forces you to think honestly about your needs and wants. Are there expenses you can cut to help beef up your savings contributions each month? Hint: the answer is probably “yes.”
Budgeting sounds like a chore but you don’t have to do it alone. There are plenty of budgeting apps out there that can help track your spending, income and accounts. When you can see how you’re spending money, it can help you create a realistic budget.
Just paraphrasing ole Teddy Roosevelt here.
There are many websites (maybe too many) that will tell you that saving money and budgeting are easy to do. But the truth is: It’s not. It takes time, discipline and patience. That said, it’s definitely doable.
Making the effort to practice good savings habits in college may not only help you pay for things like tuition and books, but it may also help you start your nest egg for after graduation. And by practicing good savings habits now, you are setting yourself up for success in the next stage of your life. Now that’s some next-level adulting!
This article is for informational purposes only and is not a substitute for individualized professional advice. Articles on this site were commissioned and approved by Marcus by Goldman Sachs®, but may not reflect the institutional opinions of The Goldman Sachs Group, Inc., Goldman Sachs Bank USA or any of their affiliates, subsidiaries or divisions.