Students today are navigating the challenges of increased cost of living, rent prices and tuition.
The average student in Georgia will graduate with $27,675 of debt, according to a study done by The Institute for College Access and Success.
“Unfortunately, several long-term trends, including the explosion of student debt, make it increasingly difficult for millennials to save for a home,” according to Apartment List.
While student loans are typically the largest source of debt after graduation, lifestyle choices also have an effect on how much debt students will have.
Stephen Newland, a financial counselor in Atlanta, graduated college with $55,000 of debt and paid it all off in four years. He now hopes to educate others on how they can do the same. Newland offers some financial advice for current students and recent graduates.
Budgeting
The three main steps he advises students to follow is to create a realistic budget for each month, to track expenses to determine if they are sticking with the budget and to start learning how to manage money as early as possible.
For those who are new to budgeting, Newland suggests keeping things simple in the beginning. He recommends a few apps to help kick-start budgeting, including Mint and Every Dollar.
“Don’t over-complicate it,” Newland said. “You can get overwhelmed easily … List it out on paper and start there.”
Some students only budget around certain times of the month when they know money is going to be tight. This is a financial practice Kylie Jonilonis does, a fourth-year risk management and insurance major from Loganville.
“I just budget more around when I’m about to pay rent. My budget is pretty much planned around that,” Jonilonis said.
Other students, like Rachel Kelso, a fourth-year journalism major from Fayetteville, feel anxious when dealing with money.
“It just kind of stressed me out looking at my bank account so much. I got really uncomfortable even viewing it,” Kelso said. “I just get anxiety when it comes to it because I know that I’m not saving the way I should be and I’m spending way too much.”
She receives help from her family and has a part-time job but is concerned about how she will manage her money once she is out of college. She said the cost of rent after graduation concerns her as well.
Rent is a major expense for many students, and the average price is increasing. According to Apartment List, the price of rent in Athens has increased 7 percent from January 2017 to January 2018.
In order to save money in rent, Newland suggests always having roommates in order to split the costs and considering areas that are within walking distance of a bus route.
Managing student loans
Newland’s advice to graduates is to continue living the cheap, college lifestyle even after their income increases to save extra money and be able to pay off their student loans.
Chelsey Schrader, a third-year consumer economics major said she wants to pay of her student loans as soon as possible so she wouldn’t have to worry about them.
“I think you get into the debate on your quality of life while you’re paying it off,” Schrader said. “Would you rather have a super strict budget just so you can pay it off, or would you rather have a more lenient budget and pay off your student debt over a longer amount of time?”
Newland said students and recent graduates should make their budgets realistic so they stick with their plans.
An individual’s socio-economic starting point also influences how long it takes them to pay off debts.
For Newland, he lost his financial stability when he was a sophomore in college after his parents went through a divorce. This lack of financial support from his family during this time landed him with student loans and debt.
“If you don’t have any financial support from family, even more reason to get on top of this and be intentional about this now because you may be able to avoid potentially getting yourself into a bunch of credit card debt later,” Newland said.
For students looking to better manage their money or reduce the amount of debt they will be in after graduation, campus resources are available, such as the Aspire Clinic. The Aspire Clinic offers various counseling services, including financial counseling and education.
The College of Family and Consumer Sciences also offers the class “Introduction to Personal Finance” as well.
There are online resources including websites, apps and youtube videos to give quick tips and tricks to better budgeting in college.