Tips for a Successful College Budget

If you’re in college, that means you’ve got a lot on your plate. Keeping up good grades. Hanging out with your friends. Studying for exams. Picking the perfect T-shirt and sweatpants combo every morning.

Yeah, all that stuff is important. But there’s something else you need to keep in mind—I’m talking about making good financial decisions.

Take it from someone who had to pay off six figures of student debt (yep, you read that right). My husband and I paid off $460,052 in debt over nine years—and $280,000 of it was student loans. I learned the hard way that studying hard and managing your money are equally important to your future. And staying on top of your money as a student starts with a good college budget.

Like I wrote in my book Money’s Not a Math Problem, budgets are like toothbrushes: Everyone needs one, and things get nasty real quick without one. So let’s walk through the steps you need to make a solid budget while you’re in school.

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And once you’ve got the hang of it, the same habits carry you through every stage of your financial life—college is just where you start.

How to Make a College Budget

1. Write down your income.

A budget is just a customized plan for your money where you decide—before each month begins—how much you’re going to give, save and spend. So the first step to making a budget is figuring out how much money you have to start with.

Add up the money you’ll have coming in during the upcoming month from all sources—including what you’ll make from your day job, side hustles, any scholarships that are paid to you directly, and any cash you’ll get from your parents. (Make sure you thank your folks if they give your bank account a lift.) One thing that does not go on this list: student loans. A loan feels like income for a minute, but it's really just debt you'll have to pay back with interest. If you’re taking out loans, the move is to stop borrowing more, not to budget them in as a paycheck. 

If your income changes month to month and you don’t know exact numbers yet, that’s no problem—just make your best guess. When you’ve got all the numbers, write them down in your budget. Then, once you’ve listed your expenses in the next step, check out the example budget below.

2. List your expenses.

Next, you’ll want to write down everything you spend money on. And I mean everything! To get you started, here are some common monthly expenses that apply to most college students:

• Food: Whether you have a campus meal plan or you buy your own groceries, you’ll have to pay for your food.
• Textbooks: College book prices are out of pocket. And by that, I mean they’re expensive! But you can save money on textbooks if you know where to look.
• Transportation: Whether you drive a car, ride a bike, or take the bus, you’ll most likely be paying for transportation. This can include the basics like gas, oil changes and car insurance, as well as extras like parking passes.
• Housing: Unless you live at home, you’ll either pay for a dorm or an apartment. Or you can do what I did and pay $150 a month to sleep on your friend’s futon. Either way, it’s going to cost you, so you need to budget for it.
• Entertainment: You’ve got to have a little bit of fun in college, right? These costs can cover everything from movie tickets to paddles for intramural pickleball. (Hey, you do you.)
• Giving: Generosity doesn’t require a degree! I recommend giving 10% of your income each month—either to your local church or a charity.
• Savings: Make sure you have money left over each month to put aside for emergencies or future tuition payments.

Now, that list is a great starting point, but you may have some other expenses that aren’t on it. So, look back at your recent bank statements or receipts and think about everything you spend money on. You don’t want anything to sneak up on you down the road—even your weekly stop at the donut shop.

Once you’ve organized your budget categories, plan how much you’ll spend for each one. Personally, I put giving and saving at the top of my list to keep my priorities in check. Then I move on to the other categories.

Some expenses that cost the same each month, like Netflix and rent, are easy to plan for. Others, like food and transportation, are more unpredictable. To make those easier, look at what you spent last month in each category and use that as a guide.

3. Subtract your expenses from your income.

Once you’ve assigned a dollar amount to every category, it’s time to whip out your calculator. If you’re anything like me, you’re ready to dip as soon as math is mentioned. But hang on—I promise this isn’t complicated at all.

All you need to do is add up the expenses you just listed, including what you plan to give, save and spend. Then subtract that total from your income.

You want that number to be a big fat zero. Why? Because a zero-based budget, where your income minus your expenses equals zero, is the only type of budget that works in the long haul. It means giving every single dollar a job.

So if your total expenses are less than your income, give that leftover money something to do—maybe you add it to savings or give it to a cause you care about. And if your total expenses are more than your income, you have two great options: increasing your income (trust me, there are plenty of ways to make extra money in college) or cutting back on your expenses (we’ll go over some tips on how to do that a little bit later).

Here’s what a zero-based budget can look like for a college student. Notice how income minus expenses lands right on zero:

4. Track your spending.

Once you get to this point, you’ve officially made your first college student budget. Let’s go! Give yourself a minute to celebrate this win.

But you’re not quite done. Turns out, you can’t just make a budget and expect something to happen—you have to stick to it.

The biggest key to sticking to your budget is tracking your spending throughout the month. If you wait until the end of the month to see if you’re on track, you’re too late!

Why Is a Zero-Based Budget Best for Students?

A zero-based budget is the best method for students because it gives you total control over every single dollar, ensuring you don’t overspend on wants while your needs go unmet.

Some budgeting methods (like the popular 50/30/20 split) tell you to put a flat percentage toward wants and call it done. That’s a reasonable starting point for a steady paycheck, but it’s too loose for a college budget, where your income might be $400 one month and $150 the next. In college, every dollar is precious. If you don’t give each one a job, they’ll disappear into late-night pizza runs.

It also matters more than usual right now: Full-time college costs (including tuition, fees, housing and food) average roughly $26,000 a year at an in-state public school and about $61,000 a year at a private school for the most recent published academic year, before a single textbook or pizza run.¹ A zero-based budget is how you make sure your part-time paycheck and financial aid actually cover what they’re supposed to, instead of quietly evaporating.

And here’s the part that matters most: Debt is a thief. It steals your income and your future before you even get your diploma. If you already have student loans, the goal isn’t to “budget around” them like a bill you’ll always have. It’s to stop borrowing immediately and start attacking them the day you have income to do it with.

Dawn, a member of THE Ramsey Baby Steps Community on Facebook, shared how her daughter is making some great choices with her money, including a zero-based budget:

“My college sophomore told me she wanted to create her first budget because she was spending too much lately,” Dawn said. “She already had the EveryDollar app downloaded to her phone and created her zero-based budget. She has no debt, so she’s working on her savings during her summer internship and fall co-op. Very proud of her!”

How to Cut Back on College Expenses

If you need to free up some room in your budget, cutting back on spending is an easy way to make that happen. Here are some of my favorite tips for saving money in college and lowering your monthly expenses.

How can I lower the cost of tuition?

The best way to lower your tuition bill is to go after every scholarship you can find.

But I’m already in college. Isn’t it too late for me to get scholarships? No! Plenty of scholarships are available, especially for students already enrolled in college. So start looking for ones you’d qualify for and apply to as many as you can.

How can I save money on food?

You can save money on food by getting the most out of your meal plan, if you have one. If you don’t, cook or eat at home instead of ordering out. Either way, try to get as much bang for your buck as possible. Eating in the cafeteria isn’t as fun as running to Taco Bell or Chick-fil-A, but try to avoid eating at restaurants as much as possible.

I know some cafeteria food has the nutritional value of Play-Doh, but you can find good options. And if you’re already paying for it, you might as well get your money’s worth.

If you don’t have a meal plan, try buying groceries and eating at home more often than eating out. That’ll save you a ton of money in the long run.

How can I save money on textbooks?

You can save money on textbooks by buying used instead of new, and by renting instead of buying whenever that’s an option. You can get used books for a lot less on sites like Chegg, eBay or Amazon. (Just make sure you purchase the right version.)

How can I save money on entertainment?

The easiest way to save on entertainment is to use what your college already gives you for free before you spend a dime anywhere else. Ask older students for some ways to have fun on campus without reaching into your wallet. (Just make sure your “entertainment” doesn’t involve something that would get the police called . . .)

You can also lower  your entertainment budget by cutting down on the music and TV streaming services you pay for. Do you really need Netflix, Hulu, HBO Max and Disney+? Nope! And there are tons of free streaming services you can use instead.

How do I lower my housing costs?

The cheapest housing option for most students is living at home, if you can. If that’s not on the table, your next-best move is finding a roommate to split rent with. Sometimes, on-campus housing is the most affordable option. Other times, finding a roommate and renting an apartment off campus is your best bet. Do your research and figure out which choice is the most affordable—and make sure your “bargain” apartment isn’t full of bedbugs and other health hazards. No thank you.

Start Budgeting Today!

Here’s the cold, hard truth: If you don’t have a budget, you’re not in control of your money. A budget is a game plan, and you lose the game when you don’t have one. I don’t want that for you—I want you to win.

And don’t wait to get started! Oh, I’ll make a budget right after I finish that sociology paper and eat my grilled cheese. Child, please. You and I both know that’s not going to happen. Do it now!

Stop wondering where your money went and start telling it where to go. Download EveryDollar and get your life together, right quick.