Helping Your College Student Budget

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Each summer we look forward to working with new interns through our teaching program. Today we interview Ashley, a senior at Michigan State University in the Wealth Management Program.

Nick goes on the record saying she our favorite female internet of all time!

We have a lot of clients that have children and grandchildren heading off to college. It is often hard to wrap your head around all the expenses associated with college life.

Not just the hard costs of tuition and room and board, but all the required expenses of living away from home while attending college.

Ashely gives us some great insight on this as a current college student herself.

What is it like to live as a student these days?

“It depends on what you like to do. I personally don’t go out all the time, but I have friends who do. This is the majority of what their budgets go to.”

Ashley recommends getting at least a part-time job.

“Something that really surprised me, especially at Michigan State, is the cost of parking passes. My sophomore year I had to spend $350 on a parking pass for the lot right next to my dorm. I think that it is kind of crazy if you think about it. I think MSU should have more options for free parking.”

Despite the availability of Uber and public transportation, Ashley says the majority of the students that she knows have cars on campus.

She spends most of her money on:

• Rent
• Utilities
• Groceries
• Entertainment

Anything she has leftover she saves for the short term. She is not currently investing, but rather saving her money and plans to start investing after college when she has a secure full-time job. Many of her fellow finance students view this differently and have started investing.

Discussing Student Loans

Ashely reveals that most students don’t talk about their student loans. It is a huge burden and not easy to talk about. It is a real stress point that most students try to ignore until after graduation. Many students also rely on scholarships or a combination of both.

Retirement Accounts

One of the biggest takeaways Ashley has learned during her internship here and working with our clients is to start a retirement as soon as she can. She can take advantage of this now while she is in a lower tax bracket. Opening a Roth now and then moving into a pre-tax account after when she is in a higher tax bracket. She has also learned that long-term investing is a really good strategy. A well-diversified portfolio will grow over time.

“I really think that is the best strategy.”

What do you wish you would have known?

Nick askes, “Now that you have learned some of these things, what do you wish you would have known heading into your freshman year?”

Ashley admits, “I would have spent a lot less money. I’ve always been an avid shopper. My parents like to joke that I have a shopping addiction. I would have saved more. Put some money every month into investments and left it there.”

As a finance student, so your friends as you for advice?

“I haven’t been asked by too many of my friends, but if I could take them something it would be the same things I tell myself, to save more for the things that matter to you, invest a little bit in the stock market, open a Roth as soon as you can.”

Thank you for all of your hard work here this summer! We have really enjoyed working with you and learning from you.

Need Help?

The financial advisors at Shotwell Rutter Baer work with many clients to maximize their retirement plan benefits and abilities. If you would like to find if there is more you can do with your plan, give us a call at 517-321-4832.

Check out our Strategic Reliable Blueprint process here. 

About Shotwell Rutter Baer

Shotwell Rutter Baer is proud to be an independent, fee-only registered investment advisory firm. This means that we are only compensated by our clients for our knowledge and guidance — not from commissions by selling financial products. Our only motivation is to help you achieve financial freedom and peace of mind. By structuring our business this way we believe that many of the conflicts of interest that plague the financial services industry are eliminated. We work for our clients, period.

Click here to learn about the Strategic Reliable Blueprint, our financial plan process for your future.

Call us at 517-321-4832 for financial and retirement investing advice.