College students are in a unique and often precarious position during these unprecedented times. For one, they are grappling with changes in the cost of college and the overall landscape of financial aid. Additionally, college students are likely to work service jobs or “gig-economy” jobs, which have been more susceptible to job loss and a lack of employment benefits compared with more stable types of work one might acquire after graduating.
“According to a population survey by the U.S. Bureau of Labor Statistics, 12.5% of 20- to 24-year-olds were unemployed in September 2020, compared to last September’s 6.3% unemployment within the age group. The 18 to 19 age group had 15.4% unemployment rate” reports The State News.
Additionally, students attending college are often somewhat inexperienced with finances and have very little savings to serve as a safety net. For learners eager to combat financial struggles, or even to make a start at saving and getting ahead, here are a few practical money strategies for college students.
Seek Out Help Available to You
You may be eligible for modified student loans and grants, such as the Pell Grant, if your family’s annual household income has fallen below $50k during the pandemic, even if it was previously higher. Stafford loans are also a great option you may not yet be utilizing. They defer interest until after graduation and are ideal for people who are just making ends meet now but have a good chance of being a higher earner upon graduating. Also, the government’s CARES Act stimulus provides specific aid to college students who are not traditionally eligible for unemployment.
Track Your Spending
Consider using a money-monitoring app through your bank or a reputable third-party. Often, seeing a visual representation — such as a pie chart — of monthly spending categories can help to identify areas that could easily be cut back and other ways to save, such as shopping at a more affordable grocery store or canceling a gym membership you can’t use due to COVID.
Track Your Subscriptions
This is related to the previous point but deserves its own emphasis. Be aware that you may have subscriptions you are not using, do not really need, or don’t realize are still active. Consolidate and check all your logins to be sure you only have what you want and use.
Prioritize an Emergency Fund
If you have the ability to save, start by putting away at least 10% of your pre-tax income until you have three months of bare-minimum expenses saved. As daily life improves, shoot to ultimately have 6-12 months of expenses saved. Then, increase that to 6-12 months’ worth of average income saved, which is more than basic expenses.
Find Creative Side Hustles
College is certainly a busy time, but these uncertain times may necessitate finding different side hustles, such as ones that can be done remotely. For example, if you previously waited tables two nights a week, but now restaurants are closed in your area, consider applying to become a virtual assistant or taking online surveys. Also, don’t forget about work-study opportunities through your federal loan program.
The pandemic has stolen much from young Americans, but these tips may help to financially strategize and begin to take steps in the right direction as a college student.