The College Student’s Guide to Building a Budget

Brought to You by Our Partners at College Ave Student Loans

Would most of us like to live a budget-free, yacht-and-fancy-vacation-filled life, like that of a Hollywood movie star or certain reality TV family? Yes. However, do most of us actually live those kinds of lives?

No. Especially not college students.

That’s why our partners at College Ave Student Loans pulled together this starter guide for building a budget. Keep reading to find out how you can be smarter about spending your hard-earned money and savvier when it comes to saving it.


building a budget


Step One: Building a Budget


First: Take a look at your income.

How much money do you bring in every month? Create a document that details this information. Your “income” can be paychecks from work, money from your parents, etc.


Second: Block out your expenses.

Next, lay out your mandatory expenses – rent, utility bills, etc. These are things you have to pay. Once you have these laid out, divide them into two groups: fixed and variable.

  • Fixed expenses remain the same every month (i.e. rent, car payments, and insurance). Input the amount you pay for these each month.


  • Variable expenses can change from month to month (i.e. utility bill, gas money, groceries). Take a look at the range of how much you usually spend on these, then plan around the higher number.

Example: If your utility bill is usually between $40-$60 per month, plan around the $60. If your utility bill falls below that, you’ll have some extra money to save or use in case of an emergency!


Third: Total up the numbers.

Once you’ve blocked out your income and mandatory expenses, it’s time to see where you land. First, add up both your mandatory fixed expenses and mandatory variable expenses – then add them together. Once you have your total mandatory expenses for each month, subtract that number from your total income. The remainder is what you have left for savings and for the “fun stuff” – eating out, going to the movies, etc.


Step Two: Create a Savings Plan


First: Think about how much you’d like to save.

Now that you’ve figured out how much you’ll have left after all of your mandatory expenses, it’s time to tackle your savings plan. Is there something specific you want to save up for? Or is your goal to simply save as much as possible? Whatever your ultimate objective is, settle on a monthly number that will help you reach that goal – it can be a specific dollar amount (e.g. $100) or a percentage (e.g. 30%). You can always increase or decrease this number later, but do your best to put that amount in savings each and every month.


Second: Consider your spending money.

Once you have your mandatory expenses and your savings contributions blocked out, you can attribute the rest of your income to spending money for the “fun stuff” we mentioned in Step One.


building a budget


Step Three: Make Regular Adjustments

Naturally, your expenses and spending will fluctuate from month to month, so it’s important to make regular adjustments to your budget. For example – it’s likely you’re going to spend additional money on gifts during the holidays, so block that into your December budget ahead of time. Or, perhaps, you’d like to take a vacation during Spring Break. Plan to cut down on your spending money during the months prior.

Paying close attention to where your money is going will help you identify places to cut back or make smarter choices.


You’re ready to start building a budget of your own! If you have questions or tips of your own to share, feel free to post a comment below.


building a budget

building a budget



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