How to Save Money as a College Student
"Man, I Wish I Had Saved More Money"
At some point, nearly everyone has this thought—whether spoken aloud or as an internal regret. In the U.S., we grow up surrounded by a culture of consumption. Advertisements constantly compete for our attention and wallets, making saving money feel nearly impossible, especially when you’re a college student just starting out.
But here’s the good news: saving money isn’t as difficult as it seems once you develop good financial habits. As a college student, I learned how to save despite limited income, and these tips helped me build a strong foundation for future financial health.
Key Points
Automate Your Savings: Save 10% of your paycheck automatically to build a reliable financial cushion.
Budget Wisely: Track your spending and set limits to uncover savings opportunities.
Save 10% of Your Paycheck
This simple strategy is one of the easiest ways to start saving, even if you’re not an expert at managing money yet. I call it the “idiot-proof savings plan” because it works without requiring constant effort. Here's how:
Automate your savings. Set up automatic transfers to move 10% of every paycheck directly into a savings account. By doing this, you’ll save money without having to think about it.
Use a high-yield savings account. Maximize your savings by placing them in a high-yield account offering a 4%-5% annual percentage yield (APY). This helps your money grow passively over time.
Over time, consistently saving 10% of your paycheck creates a financial cushion that can be a lifesaver in emergencies or provide capital for future investments.
Budget, Budget, Budget
Budgeting may sound boring, but it’s a game-changer for anyone looking to save money and improve their overall financial health. The key benefit of budgeting is that it forces you to face the reality of your spending habits—good or bad.
Here’s how to start:
Review your spending. Focus on one category at a time, such as food. Analyze how much you spend on dining out compared to cooking at home.
Set spending limits. Once you understand where your money is going, establish clear limits for each spending category. Stick to these limits to build discipline.
Track your progress. Use budgeting apps or a simple spreadsheet to monitor your spending and hold yourself accountable.
By consistently following these budgeting practices, you’ll uncover opportunities to save, cut back on unnecessary expenses, and achieve your financial goals faster.
With these two foundational tips—saving 10% of your paycheck and sticking to a budget—you’ll be on your way to building solid financial habits during your college years and beyond.