5 most important habits that students must have for better financial health

New college life is always exciting, every student looks forward to it eagerly. While regular college students just look forward to studying, making new friends and having fun, hostellers have a little more to do. They need to look after their finances well right from day one so that they need not borrow money from family and friends. So, it is always good to sit down and plan your finances. Budgeting is a good starting point as it will let you know how much money you have at your disposal and how much money you need to spend per month.

You might not realise, but the financial discipline will help you through your 20s and beyond. Not only this will help you move to a new city after college but will also help you part-pay off your student loan (if any). So, the sooner the better.

There are a number of things that you could do whilst attending college. Maybe a good starting point will be to use a monthly budgeting app. This will help you keep a check on all your expenses neatly. Or, maybe, you could use Google sheets for your accounting purposes. The purpose is that you should inculcate the habit of keeping track of your income and expenses religiously to achieve your financial goals.

However, there are several other things you would need to do for better financial health. Keep reading as we are going to discuss important tips for better financial health.

1. Find a part-time job

A part-time job might sound an odd idea to Indian students, but it is a norm in all western countries. Students abroad pay their own bills after finishing school. Having a part-time job not only helps you financially but also adds to your self-esteem. More importantly, a part-time job adds tremendous weight to your CV. Employers are always looking for youngsters who have prior work experience, so these students get hired quickly as soon as they finish college.

A part-time job in India might not be enough to pay off your student loan but it can certainly take care of your monthly expenses. Moreover, depending upon the job profile, you would be able to learn new skills. For example, if you are a vendor management trainee, you will learn negotiation skills. All the skills you acquire will help you grow personally and professionally.  Also, you will be able to apply the skills learned at college in real-life situations at work.

2. Budgeting

As mentioned above, budgeting might be a good starting point to achieving good financial health. Use whatever budgeting tool you feel comfortable with. It will become easier to plan your expenses after you have started a part-time job. A job will not only give you a good reason but also provide the right dose of inspiration to plan your finances well.

Budgeting helps to avoid non-essential purchases or plan purchases meticulously. As a student, especially as a hosteller, you will have to learn the difference between needs and wants. Needs are necessities like food, accommodation and clothes. Every other thing is a want, which can be curtailed.

Budgeting needs a lot of discipline. So, it might not be an easy exercise for many, but if done correctly and consistently, it can help you to be in good financial health, not only in college but throughout your life.

3. Go for a savings account

As soon as you join a college, opening a savings account should be on your priority list. Most banks have special offers or concessions for students. Many banks have tailor-made savings account options for students where there is no requirement to maintain a certain amount of funds each month.

Plus, leading banks have their mobile apps which are very handy like Mobile by ICICI Bank. Using the app, a student can open recurring deposits (RD) or invest in SIP (Systematic Invest Plan) as per one's preference. The app will also allow auto-debit functionality which will help you make forced savings.

Maybe you could start saving in a SIP with a weekly goal of Rs 1,000. This weekly saving will approximately add up to INR 52000 at the end of the year! Plus, you will get the benefit of compounding and your actual savings would be much more than Rs 52,000!

4. Time your purchases around the festive offers

Big online marketplaces like Amazon and Flipkart offer huge discounts of over 50% during their festive offers. Since these offers are pre-announced, it is easy to plan your big purchases like mobile phone, laptop or clothes during offer periods. The good thing is that these big discount offers happen many times around the year, so you will not be required to wait for long to buy your things.

It is always advisable to have your list ready well before the offer dates so that you can go for a planned shopping. However, don't forget that you are a student and you should stick to the basics.

5. Share your internet and entertainment bills

It is quite understandable that today's youngsters will find it very difficult to live without streaming services, be it Netflix or Spotify. Moreover, you might need mobile data plans if you don't have high-speed broadband in your hostels. Students can easily go for shared mobile bills by opting for suitable plans with high data allocations. Likewise, students can go for streaming plans that allows multi-device viewing simultaneously. This will help split the monthly bills.

To sum up, the five simple tips are bound to keep you in good stead during your college and beyond. Remember, the college experience will be like a breeding ground for you. The habits that you inculcate during this time will bear fruits you will cherish your entire life. Managing finance is the most critical part of anyone's life, the sooner you master this art, the better and brighter chances of success you will have.

Note: The views expressed in this article are that of the institute and do not reflect/represent those of Shiksha