How is your semester going?.....Financially? Try to avoid these common mistakes that can create unnecessary hardship and impact your success during and after Brown:
#1. Not having a budget
Coming (back) to campus and living as a student is a major adjustment. It’s important to assess as quickly as possible where your money is being spent since this can be much different than it was even a few weeks ago. Documenting your money inflows and outflows will help you make the adjustments necessary quickly so you can avoid a money crisis. Check out Brown’s Budgeting Basics seminar (link to registration?) in October for help!
#2. Using credit cards for cash advances
Using a credit card is another method of borrowing money. Withdrawing cash from a credit card is the most expensive form of borrowing, usually with extra finance charges and higher interest that adds to your debt. Don’t use a credit card unless it is for convenience only; you should have the resources available to pay your entire credit card “loan” balance before the due date. Attend our Understanding Credit, Credit Cards and Credit Debt workshop to learn more about how to build your credit, not compromise it.
#3. Not saving for emergencies and unexpected events
Life “happens” for us all, including unexpected events and expenses. When you don’t have resources to cover these expenses, you will need to borrow, which means you will be in debt. Avoid debt as much as possible when you are earning a limited income or none at all.
#4. Not living within your means but rather your lifestyle
Were you lucky enough to be working over the summer and had some income to spare? Have a car at your disposal when you go home? Used to borrowing your sibling or parents’ clothes and shoes? Now that you’re at Brown, you need to adjust (back) to being a student again. Sometimes this can provoke unnecessary spending if you are trying to maintain the same existence as you had at home. Be careful about those “hidden” costs such as morning coffee, extra phone/data charges, or having to buy your own gloves this Fall; they can add up and cause you to spend more than you have.
#5. Not being actively involved in your finances
Do you know how much total student loan debt you have? What your balance is in your bank account? How much you may need to get home for the holidays? What your annual interest rate is if you own a credit card? What’s in your wallet if it ever got stolen? How much in unnecessary fees did you pay this year? Understanding where you are financially is necessary before you can then decide where you want to be. You can then build goals that both accommodate your circumstances and build on opportunities.
#6. Not planning for your educational debt until your graduation year
Will you have debt when you graduate from Brown? If you are borrowing loans as a first or second year student then chances are this will repeat during your future years of matriculation. If this amount is at the five figure level (yes, this means with 3 digits after the comma) then chances are you may qualify for Federal government repayment incentives or even forgiveness programs that help you with debt (US citizens). By planning your academics and career goals early you can make educated choices on whether you wish to tweak these goals in order to also take advantage of these loan repayment/forgiveness opportunities. Brown’s GET YOUR BEARINGS: Financial Literacy program offers workshops specifically about this exploration of Federal loan repayment options so you can plan ahead and not miss out. Check out our calendar on our loan repayment workshops.
#7. Not taking advantage of the knowledge and programming while at Brown
Ever hear of that saying, “You don’t know what you had until it’s gone?” The opportunity to learn so many things while studying at Brown seems limitless. This includes learning about financial health and wellness. Take advantage of the “wealth” of workshops and knowledge that we provide you through GET YOUR BEARINGS: Brown Financial Literacy programming. If nothing else, you’re on our listserve if you’re reading this article so become one or our avid readers and participants. Want to see more topics? Have some ideas? Email us at firstname.lastname@example.org.