By Tiffany Patel Linda
Many students love shopping non-durable and consumption goods like clothing, makeup, alcohol, hair and so forth. The outcome of this might be endless debt and financial crisis.
It can be hard at first, but with some sacrifice and self-discipline, any student can learn to live within his/her means and I will show you how.
Know your income and expenses
Income is money got from a certain job. Knowing your income and expenses can be achieved by making a list of preference. A list of preference in economics is the arrangement of the choice of your needs from the most preferred, to the least. Then, look at all the income you earn from your job, allowances and so forth. After balancing your bills, make sure that they are in line with the scale of preference list and when the list outweighs your bill, then buy the most preferred items and forego the least preferred hence keeping yourself off debts.
Track your expenses
As a student, it’s important to have a diary where you note your spending plan; it can even be done online for those who are lazy to write. Keep track by checking your daily expenses comparing the totals against your plan.
If a student wants to live within their means and reach their goals without incurring debt, he or she has to track where his or her money is going.
Separate wants and needs
Before you go shopping, differentiate your ‘wants’ from your ‘needs’. This will keep you living within your means because you will only buy the ‘must-haves’.
Needs will be the goods or services that are required like food, clothing and so on, whereas wants are goods and services that are not necessary but we desire or wish to have.
Before you make a purchase, ask yourself if you really need that particular good or if you just want it. This should be the basis of your buying decision. If it’s so crucial and important, then make up your mind quickly and buy it before another good thing comes into your mind.
Do not compete with your fellow students
In life, all of us can never be at the same level, there exist the rich, moderate or poor and all the three statuses have different needs according to their incomes. Thus if your income is moderate, then do not desire to have something that is beyond your income (something that is meant for the rich).
For instance, a student from a rich family has the ability to buy consumption as well as luxurious goods, and then here comes the student from a moderate or humble family who also wants to have the same things. The result would be to borrow money from colleagues to maintain this lifestyle hence leading to a flood of debts. Be comfortable in who you are and what you have, know your income and avoid competition.
Learn the norm of saving
Save at least 5% of your daily income and by the end of the semester, you will have saved some good money. This saved money could help you start a small business which with time would grow. Saved money could also help you in times of emergencies.
Look for a job to boost your income
Because we all know that the more you spend, the more you will run out of money and if you have nothing to replace what you’ve spent, then you will soon be broke. Earn some extra income by getting something to do even if it’s a part time job, where you will work for a few hours a day.
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