{"id":2147,"date":"2016-09-22T21:27:45","date_gmt":"2016-09-22T21:27:45","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/waymaker-collegesuccess\/?post_type=chapter&#038;p=2147"},"modified":"2024-05-01T18:48:49","modified_gmt":"2024-05-01T18:48:49","slug":"saving-strategies","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/chapter\/saving-strategies\/","title":{"raw":"Saving Strategies","rendered":"Saving Strategies"},"content":{"raw":"<div class=\"textbox learning-objectives\">\r\n<h3>Learning Outcomes<\/h3>\r\n<ul>\r\n \t<li>Explore factors in financial savings for college students<\/li>\r\n<\/ul>\r\n<\/div>\r\n<h2>Spending Hazards<\/h2>\r\nLots of students work hard and manage to cover the cost of attending college, but plenty\u00a0find that they don't have a lot left over for other important things, like housing and food. The idea of actually saving money\u2014for things like clothes, entertainment, or other extras\u2014may seem completely out of reach. In this section, we challenge you to take a chance and try. You may be surprised to find\u00a0that you can change your spending habits, gain\u00a0better control over your finances, and wind up with money in the bank. Below are some common hazards you can avoid and tips to get you started:\r\n<ul>\r\n \t<li><strong>New spending responsibilities<\/strong>: If you're starting college right out of high school, this may be the first time you've had your\u00a0own checking account or received\u00a0regular income from\u00a0a job. It may\u00a0be tempting to spend what's left over after you pay for big items\u00a0like tuition and books, forgetting that you still have other expenses. Even if you don't spend a lot of money on extras, you may not be aware of strategies for saving money, such as keeping an eye out for coupons and sales.<\/li>\r\n \t<li><strong>Using credit cards<\/strong>: Young college students are often targeted by credit card companies because they have comparatively few financial responsibilities and generally have clean credit records. Owning and using a credit card can be an effective way to build a credit history and it can also be useful in an emergency, but credit cards do carry significant risk: if you don't pay them off in full every month, they accrue interest\u2014sometimes at a very high rate\u2014and the total amount you owe can become an enormous financial burden.<\/li>\r\n \t<li><strong>Neglecting to pursue scholarships<\/strong>:\u00a0Many college students are either unaware of scholarships they qualify for or they just don't follow through and apply. Take advantage of the financial aid office at your college. Ask questions and get help finding out what's available to you. You may be passing up an opportunity to get money for tuition, room and board, and books.<\/li>\r\n \t<li><strong>Recreational activities<\/strong>: Unlike high school students, college students don\u2019t generally have classes all day, so they may find themselves with hours of free time. To fill that time, they may want to go to places like restaurants, movies, and shopping centers. These activities add up fast and cost more money than eating on campus with a room-and-board plan or cooking meals and socializing at home.[footnote]Reaume, Amanda. \"6 Common Money Mistakes College Freshmen Make.\" <em>Yahoo! Life<\/em>,\u00a04 Sept 2015,\u00a0www.yahoo.com\/lifestyle\/s\/6-common-money-mistakes-college-110010808.html.[\/footnote]<\/li>\r\n \t<li><strong>Not realizing you're paying for something:\u00a0<\/strong>This can happen with monthly subscription to services you don't need or use, or it can be a fee you pay to your bank to have a checking account. There are many areas where you might be paying for something when you could get a free version or cancel your digital subscriptions you've forgotten about.<\/li>\r\n<\/ul>\r\n<div class=\"textbox exercises\">\r\n<h3>small savings<\/h3>\r\nCan you identify areas in your life where you are losing money by paying fees on your checking account or interest on your loans? What actions could you take to stop giving away money and instead set yourself up to start earning money?\r\n\r\n<\/div>\r\n<h2>Saving Strategies<\/h2>\r\nWhether you are starting college as a single eighteen-year-old or you are older, working, and raising a family, there's a set of basic financial strategies that can help you lower your expenses and save money while you're in school. Analyzing your spending habits (as you just did) is the first step. Next, you can try the following:\r\n<ul>\r\n \t<li><strong>Create a detailed budget<\/strong>: Budgets will enable\u00a0you to treat yourself while avoiding overspending. For example, you might allot $50 a month for going out with friends. If you\u2019ve already spent $50, you should find alternative recreational activities for the rest of the month so you don't have to borrow money that you set aside for other expenses.<\/li>\r\n \t<li><strong>Cut down on meal costs<\/strong>: Looking for deals and using coupons at grocery stores will save more money than eating out. Students living in dorms may\u00a0not have a lot of space and supplies\u00a0for cooking, but they may\u00a0still have room for a refrigerator and coffee maker to avoid overspending on snacks and trips to Starbuck's.<\/li>\r\n \t<li><strong>Save on transportation<\/strong>: Cut down on the cost of gas (or get rid of your car altogether) by walking to class, riding a bike, or using public transportation. Check to see whether your college offers free or reduced-price student bus\/train passes.<\/li>\r\n \t<li><strong>Look for discounts and used items<\/strong>: As long as a textbook isn\u2019t outdated, you\u00a0can often purchase used or discounted copies online or from other\u00a0students. Need to furnish a dorm room or off-campus apartment? You'll save a lot of money by borrowing household goods from friends and family or by\u00a0purchasing them from secondhand stores.<\/li>\r\n \t<li><strong>Apply for scholarships and minimize loans<\/strong>: To repeat, scholarships don't have to be repaid, and they don't rack up interest. Do your best to apply for everything and anything that you qualify for, scholarship-wise. Winning a scholarship can have a big impact on your budget and financial health.<\/li>\r\n<\/ul>\r\n<div class=\"textbox exercises\">\r\n<h3>Eight tips for saving money<\/h3>\r\nCheck out this video for eight actionable tips for saving money while you're in school.\r\n<iframe title=\"YouTube video player\" src=\"https:\/\/www.youtube.com\/embed\/HsMT_XKA4G8\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe>\r\n\r\n<\/div>\r\n<div class=\"textbox tryit\">\r\n<h3>Try It<\/h3>\r\nhttps:\/\/assess.lumenlearning.com\/practice\/c1622990-5c6c-4bd8-8b01-a7e4e85a1385\r\n\r\n<\/div>\r\n<h2 data-type=\"title\">Remember the Big Picture<\/h2>\r\n<p id=\"fs-idm251756656\">When you think about becoming more financially secure, you\u2019re usually considering your<strong>\u00a0net worth<\/strong>, or the total measure of your wealth. Earnings, savings, and investments build up your assets\u2014that is, the valuable things you own. Borrowed money, or debt, increases your liabilities, or what you owe. If you subtract what you owe from what you own, the result is your net worth. Your goal is to own more than you owe.<\/p>\r\n\r\n<blockquote id=\"fs-idm257521872\">\r\n<p id=\"fs-idm253569296\"><strong data-effect=\"bold\">Assets (Owned) \u2013 Liabilities (Owed) = Net Worth<\/strong><\/p>\r\n<\/blockquote>\r\n<p id=\"fs-idm234266608\">When people first get out of college and have student debt, they often owe more than they own. But over time and with good financial strategies, they can reverse that situation. You can track information about your assets, liabilities, and net worth on a balance sheet or part of a personal financial statement. This information will be required to get a home loan or other types of loans. For your net worth to grow in a positive direction, you must increase your assets and decrease your liabilities over time.<\/p>\r\n\r\n<div class=\"textbox exercises\">\r\n<h3>everything you need to know about savings<\/h3>\r\nThis video is part of a series called \"The College Student's Guide to Money\" and it outlines even more information about\u00a0<a href=\"https:\/\/www.youtube.com\/watch?v=sighDv4QqxY\" target=\"_blank\" rel=\"noopener\">different types of savings accounts and what they are for<\/a>, including emergency savings and retirement savings.\r\n\r\n<\/div>\r\n<div class=\"textbox learning-objectives\">\r\n<h3>glossary<\/h3>\r\n<strong>net worth:<\/strong> the total measure of one's wealth, calculated by subtracting what one owes (liabilities) from what one owns (assets)\r\n\r\n<\/div>","rendered":"<div class=\"textbox learning-objectives\">\n<h3>Learning Outcomes<\/h3>\n<ul>\n<li>Explore factors in financial savings for college students<\/li>\n<\/ul>\n<\/div>\n<h2>Spending Hazards<\/h2>\n<p>Lots of students work hard and manage to cover the cost of attending college, but plenty\u00a0find that they don&#8217;t have a lot left over for other important things, like housing and food. The idea of actually saving money\u2014for things like clothes, entertainment, or other extras\u2014may seem completely out of reach. In this section, we challenge you to take a chance and try. You may be surprised to find\u00a0that you can change your spending habits, gain\u00a0better control over your finances, and wind up with money in the bank. Below are some common hazards you can avoid and tips to get you started:<\/p>\n<ul>\n<li><strong>New spending responsibilities<\/strong>: If you&#8217;re starting college right out of high school, this may be the first time you&#8217;ve had your\u00a0own checking account or received\u00a0regular income from\u00a0a job. It may\u00a0be tempting to spend what&#8217;s left over after you pay for big items\u00a0like tuition and books, forgetting that you still have other expenses. Even if you don&#8217;t spend a lot of money on extras, you may not be aware of strategies for saving money, such as keeping an eye out for coupons and sales.<\/li>\n<li><strong>Using credit cards<\/strong>: Young college students are often targeted by credit card companies because they have comparatively few financial responsibilities and generally have clean credit records. Owning and using a credit card can be an effective way to build a credit history and it can also be useful in an emergency, but credit cards do carry significant risk: if you don&#8217;t pay them off in full every month, they accrue interest\u2014sometimes at a very high rate\u2014and the total amount you owe can become an enormous financial burden.<\/li>\n<li><strong>Neglecting to pursue scholarships<\/strong>:\u00a0Many college students are either unaware of scholarships they qualify for or they just don&#8217;t follow through and apply. Take advantage of the financial aid office at your college. Ask questions and get help finding out what&#8217;s available to you. You may be passing up an opportunity to get money for tuition, room and board, and books.<\/li>\n<li><strong>Recreational activities<\/strong>: Unlike high school students, college students don\u2019t generally have classes all day, so they may find themselves with hours of free time. To fill that time, they may want to go to places like restaurants, movies, and shopping centers. These activities add up fast and cost more money than eating on campus with a room-and-board plan or cooking meals and socializing at home.<a class=\"footnote\" title=\"Reaume, Amanda. &quot;6 Common Money Mistakes College Freshmen Make.&quot; Yahoo! Life,\u00a04 Sept 2015,\u00a0www.yahoo.com\/lifestyle\/s\/6-common-money-mistakes-college-110010808.html.\" id=\"return-footnote-2147-1\" href=\"#footnote-2147-1\" aria-label=\"Footnote 1\"><sup class=\"footnote\">[1]<\/sup><\/a><\/li>\n<li><strong>Not realizing you&#8217;re paying for something:\u00a0<\/strong>This can happen with monthly subscription to services you don&#8217;t need or use, or it can be a fee you pay to your bank to have a checking account. There are many areas where you might be paying for something when you could get a free version or cancel your digital subscriptions you&#8217;ve forgotten about.<\/li>\n<\/ul>\n<div class=\"textbox exercises\">\n<h3>small savings<\/h3>\n<p>Can you identify areas in your life where you are losing money by paying fees on your checking account or interest on your loans? What actions could you take to stop giving away money and instead set yourself up to start earning money?<\/p>\n<\/div>\n<h2>Saving Strategies<\/h2>\n<p>Whether you are starting college as a single eighteen-year-old or you are older, working, and raising a family, there&#8217;s a set of basic financial strategies that can help you lower your expenses and save money while you&#8217;re in school. Analyzing your spending habits (as you just did) is the first step. Next, you can try the following:<\/p>\n<ul>\n<li><strong>Create a detailed budget<\/strong>: Budgets will enable\u00a0you to treat yourself while avoiding overspending. For example, you might allot $50 a month for going out with friends. If you\u2019ve already spent $50, you should find alternative recreational activities for the rest of the month so you don&#8217;t have to borrow money that you set aside for other expenses.<\/li>\n<li><strong>Cut down on meal costs<\/strong>: Looking for deals and using coupons at grocery stores will save more money than eating out. Students living in dorms may\u00a0not have a lot of space and supplies\u00a0for cooking, but they may\u00a0still have room for a refrigerator and coffee maker to avoid overspending on snacks and trips to Starbuck&#8217;s.<\/li>\n<li><strong>Save on transportation<\/strong>: Cut down on the cost of gas (or get rid of your car altogether) by walking to class, riding a bike, or using public transportation. Check to see whether your college offers free or reduced-price student bus\/train passes.<\/li>\n<li><strong>Look for discounts and used items<\/strong>: As long as a textbook isn\u2019t outdated, you\u00a0can often purchase used or discounted copies online or from other\u00a0students. Need to furnish a dorm room or off-campus apartment? You&#8217;ll save a lot of money by borrowing household goods from friends and family or by\u00a0purchasing them from secondhand stores.<\/li>\n<li><strong>Apply for scholarships and minimize loans<\/strong>: To repeat, scholarships don&#8217;t have to be repaid, and they don&#8217;t rack up interest. Do your best to apply for everything and anything that you qualify for, scholarship-wise. Winning a scholarship can have a big impact on your budget and financial health.<\/li>\n<\/ul>\n<div class=\"textbox exercises\">\n<h3>Eight tips for saving money<\/h3>\n<p>Check out this video for eight actionable tips for saving money while you&#8217;re in school.<br \/>\n<iframe loading=\"lazy\" title=\"YouTube video player\" src=\"https:\/\/www.youtube.com\/embed\/HsMT_XKA4G8\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<\/div>\n<div class=\"textbox tryit\">\n<h3>Try It<\/h3>\n<p>\t<iframe id=\"assessment_practice_c1622990-5c6c-4bd8-8b01-a7e4e85a1385\" class=\"resizable\" src=\"https:\/\/assess.lumenlearning.com\/practice\/c1622990-5c6c-4bd8-8b01-a7e4e85a1385?iframe_resize_id=assessment_practice_id_c1622990-5c6c-4bd8-8b01-a7e4e85a1385\" frameborder=\"0\" style=\"border:none;width:100%;height:100%;min-height:300px;\"><br \/>\n\t<\/iframe><\/p>\n<\/div>\n<h2 data-type=\"title\">Remember the Big Picture<\/h2>\n<p id=\"fs-idm251756656\">When you think about becoming more financially secure, you\u2019re usually considering your<strong>\u00a0net worth<\/strong>, or the total measure of your wealth. Earnings, savings, and investments build up your assets\u2014that is, the valuable things you own. Borrowed money, or debt, increases your liabilities, or what you owe. If you subtract what you owe from what you own, the result is your net worth. Your goal is to own more than you owe.<\/p>\n<blockquote id=\"fs-idm257521872\">\n<p id=\"fs-idm253569296\"><strong data-effect=\"bold\">Assets (Owned) \u2013 Liabilities (Owed) = Net Worth<\/strong><\/p>\n<\/blockquote>\n<p id=\"fs-idm234266608\">When people first get out of college and have student debt, they often owe more than they own. But over time and with good financial strategies, they can reverse that situation. You can track information about your assets, liabilities, and net worth on a balance sheet or part of a personal financial statement. This information will be required to get a home loan or other types of loans. For your net worth to grow in a positive direction, you must increase your assets and decrease your liabilities over time.<\/p>\n<div class=\"textbox exercises\">\n<h3>everything you need to know about savings<\/h3>\n<p>This video is part of a series called &#8220;The College Student&#8217;s Guide to Money&#8221; and it outlines even more information about\u00a0<a href=\"https:\/\/www.youtube.com\/watch?v=sighDv4QqxY\" target=\"_blank\" rel=\"noopener\">different types of savings accounts and what they are for<\/a>, including emergency savings and retirement savings.<\/p>\n<\/div>\n<div class=\"textbox learning-objectives\">\n<h3>glossary<\/h3>\n<p><strong>net worth:<\/strong> the total measure of one&#8217;s wealth, calculated by subtracting what one owes (liabilities) from what one owns (assets)<\/p>\n<\/div>\n\n\t\t\t <section class=\"citations-section\" role=\"contentinfo\">\n\t\t\t <h3>Candela Citations<\/h3>\n\t\t\t\t\t <div>\n\t\t\t\t\t\t <div id=\"citation-list-2147\">\n\t\t\t\t\t\t\t <div class=\"licensing\"><div class=\"license-attribution-dropdown-subheading\">CC licensed content, Original<\/div><ul class=\"citation-list\"><li>College Success. <strong>Authored by<\/strong>: Jolene Carr. <strong>Provided by<\/strong>: Lumen Learning. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><\/ul><div class=\"license-attribution-dropdown-subheading\">CC licensed content, Shared previously<\/div><ul class=\"citation-list\"><li>College Success. <strong>Authored by<\/strong>: Amy Baldwin. <strong>Provided by<\/strong>: OpenStax; Modified by Lumen Learning. <strong>Located at<\/strong>: <a target=\"_blank\" href=\"https:\/\/openstax.org\/books\/college-success\/pages\/10-2-savings-expenses-and-budgeting\">https:\/\/openstax.org\/books\/college-success\/pages\/10-2-savings-expenses-and-budgeting<\/a>. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><\/ul><div class=\"license-attribution-dropdown-subheading\">All rights reserved content<\/div><ul class=\"citation-list\"><li>How To Save Money, No Matter How Much You Earn. <strong>Authored by<\/strong>: Chelsea Fagan. <strong>Provided by<\/strong>: The Financial Diet. <strong>Located at<\/strong>: <a target=\"_blank\" href=\"https:\/\/www.youtube.com\/watch?v=HsMT_XKA4G8&#038;feature=emb_title\">https:\/\/www.youtube.com\/watch?v=HsMT_XKA4G8&#038;feature=emb_title<\/a>. <strong>License<\/strong>: <em>All Rights Reserved<\/em>. <strong>License Terms<\/strong>: Standard YouTube License<\/li><\/ul><\/div>\n\t\t\t\t\t\t <\/div>\n\t\t\t\t\t <\/div>\n\t\t\t <\/section><hr class=\"before-footnotes clear\" \/><div class=\"footnotes\"><ol><li id=\"footnote-2147-1\">Reaume, Amanda. \"6 Common Money Mistakes College Freshmen Make.\" <em>Yahoo! Life<\/em>,\u00a04 Sept 2015,\u00a0www.yahoo.com\/lifestyle\/s\/6-common-money-mistakes-college-110010808.html. <a href=\"#return-footnote-2147-1\" class=\"return-footnote\" aria-label=\"Return to footnote 1\">&crarr;<\/a><\/li><\/ol><\/div>","protected":false},"author":19,"menu_order":15,"template":"","meta":{"_candela_citation":"[{\"type\":\"original\",\"description\":\"College Success\",\"author\":\"Jolene Carr\",\"organization\":\"Lumen Learning\",\"url\":\"\",\"project\":\"\",\"license\":\"cc-by\",\"license_terms\":\"\"},{\"type\":\"cc\",\"description\":\"College Success\",\"author\":\"Amy Baldwin\",\"organization\":\"OpenStax; Modified by Lumen Learning\",\"url\":\"https:\/\/openstax.org\/books\/college-success\/pages\/10-2-savings-expenses-and-budgeting\",\"project\":\"\",\"license\":\"cc-by\",\"license_terms\":\"\"},{\"type\":\"copyrighted_video\",\"description\":\"How To Save Money, No Matter How Much You Earn\",\"author\":\"Chelsea Fagan\",\"organization\":\"The Financial Diet\",\"url\":\"https:\/\/www.youtube.com\/watch?v=HsMT_XKA4G8&feature=emb_title\",\"project\":\"\",\"license\":\"arr\",\"license_terms\":\"Standard YouTube License\"}]","CANDELA_OUTCOMES_GUID":"968a1d91-1d6d-4d7f-a8ed-07037add8177, 662613c4-af8c-40b8-b8a1-9c19d57327d2","pb_show_title":"on","pb_short_title":"","pb_subtitle":"","pb_authors":[],"pb_section_license":""},"chapter-type":[],"contributor":[],"license":[],"class_list":["post-2147","chapter","type-chapter","status-publish","hentry"],"part":135,"_links":{"self":[{"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/pressbooks\/v2\/chapters\/2147","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/pressbooks\/v2\/chapters"}],"about":[{"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/wp\/v2\/types\/chapter"}],"author":[{"embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/wp\/v2\/users\/19"}],"version-history":[{"count":17,"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/pressbooks\/v2\/chapters\/2147\/revisions"}],"predecessor-version":[{"id":7688,"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/pressbooks\/v2\/chapters\/2147\/revisions\/7688"}],"part":[{"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/pressbooks\/v2\/parts\/135"}],"metadata":[{"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/pressbooks\/v2\/chapters\/2147\/metadata\/"}],"wp:attachment":[{"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/wp\/v2\/media?parent=2147"}],"wp:term":[{"taxonomy":"chapter-type","embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/pressbooks\/v2\/chapter-type?post=2147"},{"taxonomy":"contributor","embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/wp\/v2\/contributor?post=2147"},{"taxonomy":"license","embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-collegesuccess-2\/wp-json\/wp\/v2\/license?post=2147"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}