Parents, please share with your kids healthy financial information starting at an early age. I wish high schools would make personal finance a requirement to graduate. Growing up in foster care I did not have many people telling me what to do with my money. I worked for two years at McDonald’s and graduated high school with no money saved. Since I was a foster child, I had no parents helping me out when college came around. I made some huge mistakes financially. My hope is that a young college student reads this and makes different choices than I did.
5 Money Mistakes I Made as a College Student
Getting a Credit Card. Credit cards are bad news. You don’t NEED them to make a credit score. You will not “make” money with credit cards through bonus points. Most people only pay the minimum payment and end up paying so much interest. I got my credit card once I turned 19. I bought things that weren’t needs, only paid the minimum, and ending up using them more when I lost my fast food job.
Moving into a place that was more than I could really afford. A housing cost should not be more than 33% of your income. Get a roommate if you can’t swing the average rent in your area. Before I was married I had a roommate and we split costs.
Not making a budget. I knew nothing about making a budget. Now I couldn’t live without my budget. I use a zero-based budgeting approach and it has revolutionized the way I look at money.
Thinking I could live like my parents right away. Our parents have worked a long time and didn’t acquire everything they had in one month. I wanted everything right away and that mentality fueled my shopping.
Not starting a savings account. Saving while young, even starting an IRA is a very smart thing. I didn’t even think like that until I got married.
If I could only go back into time and know the things I know now. My life and my debt situation would be so much better.
What was one money mistake you made as a young person?