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Top 5 Money Mistakes You Should Avoid in College

College is one of the most exciting, memorable times in a person’s life. There are many reasons to attend college, as it allows one to gain an education, discover new passions, and meet lifelong friends. College can also heavily impact your financial future, as earning a degree can open doors for you to pursue the career of your dreams and make a rewarding salary.

However, there are many mistakes frequently made in college that can send your finances into a downward spiral. Recognize these missteps to keep your finances on the right track, and ensure that your future is not damaged by easily avoidable mistakes.

Financial Mistakes You Can’t Afford to Make

1. Missing Out on Financial Aid and Scholarships

Many students don’t apply for financial aid in a timely fashion and ultimately miss the deadline. Fill out the FAFSA as soon as possible after January 1st. You can qualify for grants (money you do not need to pay back) or federal loans (money you must pay back, but at a lower interest rate than private loans). contains more detailed information regarding financial aid.

It’s also crucial to apply for college scholarships. While you may believe that scholarships are available only to students at the top of the class, there are, in fact, many types of scholarships available to students of all different ability levels based on a multitude of criteria. is a great site that locates scholarships that match your criteria. But remember, financial aid scams do exist, so watch out!

There are also a number of other ways to seek out scholarships:

  • Check Your School. Ask your college or university finance department about scholarships. You may be eligible for specific scholarships based on your major, GPA, or other factors.
  • Search Locally. Check your city, town, and state’s websites to see what scholarships they offer.
  • Research Professional Organizations. Many professional organizations offer scholarships. For example, when I was a journalism major, I applied for scholarships through the Association of Women Journalists and Chicago Women in Publishing.
  • Consider Membership Organizations. Many membership organizations, such as Girl Scouts and the Future Farmers of America (FFA), offer scholarships for higher education based on your experience and accomplishments in the group.
  • Ask Your Family. Look for scholarships at your parents’ or grandparents’ employers or via any organizations with which they’re involved.
  • Consider Special Interest Groups. There are scholarships for students of every race, ethnicity, and physical attribute.

Consider Special Interest Groups2. Putting Off Debt Payment

Every loan I took out in college didn’t feel real. I watched the total amount grow each semester, but it didn’t sink in until after graduation and the bills started coming that I actually needed to pay this money back.

To pay for college and reduce student loan debt, follow these tips:

  • Set a Budget. Create a realistic monthly budget, and stick to it. This was my big mistake: I didn’t watch what I spent or where I spent it. Had I remained aware of where my money was going, I could have easily trimmed unnecessary expenses and lessened my financial burden upon graduation.
  • Work Part-time. Besides budgeting, squeezing in a part-time job can help reduce overwhelming student loans. On-campus jobs for students are generally flexible to meet your schedule. Or better yet, find a job that improves your resume by providing experience in your field.
  • Sign up for Upromise. To further reduce your loans, sign up for Upromise, and get your friends and family to sign up as well. Register your credit, debit, and memberships cards to receive a percentage toward your loans on qualifying purchases.
  • Make Interest Payments. Consider making the interest payments on loans while you’re still in school. Again, this can help ease the burden of debt once you graduate.

3. Not Watching Your Wallet

Watch where every dollar is spent! By keeping track of spending, you can more easily stick to your monthly budget to avoid money problems.

Here are several common spending mistakes:

  • Buying the Latest, Greatest Technology. I thought it would be detrimental to my college experience to be without a laptop. However, in time, I realized I could have easily gotten by without one, as there were computers in the lobby of my dorm, in the library, in every academic building, and in the numerous 24-hour computer labs on campus. Your school may require all incoming students to be equipped with a laptop, and certain majors may be worse off without one, but there are still many gadgets – such as tablets, MP3 players, and more – that you can easily live without.
  • Purchasing Textbooks From the College Bookstore. I feel as though I could buy a new car with the money I spent on books at my college bookstore. Before your classes begin, check with the professor to be sure whether each book is mandatory. Refer to the syllabus to see if the assigned readings are outlined, and if they are, ask to borrow a book from someone in the class to scan on your computer. You can also borrow books from the library. But if you have to buy, search,, or a used bookstore. And keep your books in excellent shape so that you can sell your used college textbooks for cash.
  • Not Using Your Student ID. Many deals and discounts are available to students. With your student ID, you can score discounts on public transportation, memberships to organizations, restaurants, shopping, and tickets to plays, movies, concerts, ski resorts, and sporting events. Always keep your ID on hand, and always ask if you are entitled to a discount.
  • Not Using Free Student Services. Many colleges have great free fitness centers, fitness classes, and intramural sports leagues. You can also save on buying books and subscriptions to magazines and newspapers by utilizing the library. Campus health centers and infirmaries can save you a bundle on health care, while the financial aid center can help you find scholarships, explain your loans and tuition, and assist you in filing taxes and other financial issues. And when the time comes, career services can help you write a great resume, build a portfolio, and find interviews.
  • Paying for Entertainment. Colleges are loaded with free events around campus. Check your college’s campus calendar for listings of free concerts, plays, speakers, sporting events, art exhibits, and other events.

Not Planning Ahead4. Not Planning Ahead

College is a fun and exciting time, but it can be a waste of time and money if you don’t properly plan for it. Think about your future and what you hope to gain from your education.

Here are a few common mistakes made by those who do not plan ahead:

  • Jumping Into a Major. Before you declare your major, take time to consider the field you’re entering. Speak with your college’s career counselor, as well as professors and advisers, and ask to sit in on a class or two. Contact professionals who are in the field or who have majored in the same thing to pick their brain and, if possible, shadow people in the profession to see a typical day’s work. Look up possible careers via the U.S. Bureau of Labor to get an inside peek at the job’s work environment, outlook for employment, and average salary.
  • Having Too Much Fun to Network Professionally. College is a memorable time to make new friends and have fun, but it should also be a time for professional networking. Keep an eye on your future, and stay focused on your planned career. You can form relationships with teachers that may land you an internship, freelance work, recommendations, and a job, as well as advice along the way. In addition to teachers, get to know the students that are in your major classes. Actively participating in clubs and organizations will help you meet people while adding to your resume.
  • Being Disorganized. It’s nice to feel independent in college, but you need to be responsible and organized. If your finances are in disarray, you can accrue late payments and overdraft fees from the bank, which are horrible for your credit. Also, keep your syllabi, professor contact information, and prominent work from each class so you can save money if you ever transfer. These records could even allow you to waive some classes in graduate school. Keeping good records will help you build a portfolio of your work and keep in touch with professors for recommendations or assistance.

5. Choosing a School for the Wrong Reasons

When it came time to choose a college, there was no doubt in my mind that I wanted to go away from my hometown to study. In many aspects, I’m glad I did because it was a great experience. However, now that I’m paying my hefty student loan payment every month, I realize I should have attended a community college for the first two years before going away. Community colleges, as well as online colleges, offer great opportunities to take general education courses for a fraction of the cost while saving thousands on room and board.

Also ask yourself these questions to find ways to save when choosing a college:

  1. Where Are You Living? Different geographic areas have different costs of living, and college is no different. For instance, the cost of living at an urban college is often more expensive than in a rural area. Also, if there is a college close to home and you can live with your parents rent-free, that is a tremendous money saver. While it may not be your ideal situation while in college, in the long run, saving money and not accruing debt can ensure your independence after you graduate.
  2. How Often Will You Return Home? Maybe you plan on rarely returning, but when you attend school far from home, even a few plane trips or road trips per year can cost hundreds or even thousands of dollars.
  3. Will You Need a Car? You’ll save a lot of money if you live on a campus or within walking distance  from your class buildings. Utilizing public transportation can also be an affordable way to get between class and home. A car requires gas, regular maintenance, insurance, registration, and a parking pass. But if you absolutely need to have one, choose an affordable car for college students.
  4. Is It Worth the Price? I attended a state school, while my sister went to a private college. Her tuition was more than double mine. Unless you’re pursuing a prestigious career (such as law, specialized medicine, or certain businesses), your degree is generally more important than the name of the school you attended.
  5. What Are Your Career Aspirations? If you’re not sure what you want to do for a career, don’t initially invest a lot of money in education. Many people end up in careers completely unrelated to their major. And you could end up going to the wrong school altogether if, for example, you enroll in a liberal arts college, only to decide later that you want to study science. Such expensive mistakes can be avoided by going the community college route for the first two years of your studies. This can give you time to make a more informed decision before transferring to the college that’s right for you.

Choosing School Wrong ReasonsFinal Word

The point of attending college is to improve your life, whether it’s to land the career you’ve always wanted, or to simply grow personally and have new experiences. Becoming overwhelmed by debt and constantly worrying about money can ruin what should be a wonderful time of your life, and may keep you from getting the most out of your college education.

Apply for financial aid, seek out scholarships, and make a plan. Once you begin school, budget every month and make wise financial decisions to keep your debt to a minimum – or nonexistent!

What financial mistakes did you make in college? What do you think are the best ways to save money in college?

Kristen Kuchar, author of "Mac 'N Cheese to the Rescue" writes about travel, food, and most importantly, enjoying life while on a budget. In the last several years, Kristen went back to college for a Journalism degree, got married, and is now pursuing a career in editing and writing. She also had to move, and her husband is going through a career change. All of these things have forced Kristen to find creative ways to save money.

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