Financial Advice for College Students, as Presented by Our Most Reputable Publications
It isn’t just College Month here at The Billfold; nearly every major publication is busy preparing students—and their parents—for the major life transition that is going to happen literally any day now.
(When did your college semesters start? I remember mine started mid-August, and then we almost immediately had a long weekend for Labor Day, and it felt like every student who lived close enough to drive went home.)
To understand what tips and warnings are most important to communicate to today’s college students—and, maybe, just to suss out the competition—I gathered samples of financial advice from three reputable publications. Let’s see what The Wall Street Journal, US News and World Report, and Cosmopolitan want college students to know.
I think it would be very beneficial if a course in behavioral finance were required at all colleges, universities and trade schools. Simply getting students to understand how their emotions and biases influence their financial decisions would be very beneficial.
The same behavioral tendencies that can lead our portfolios astray (e.g., selling stocks because one is scared about what the Federal Reserve might do) can also lead us to make bad business decisions. Though understanding behavioral finance won’t stop a person from making a colossally bad mistake, it might help them from making a less bad one—or at least be aware of their cognitive and emotional limitations.
I think I would really have enjoyed a behavioral finance class. I always enjoy learning how to override my emotions, and it would have been interesting to learn how people make bad financial decisions. I just hope it would have been more than the tired old “did you know that when a store sells a lot of different kinds of jam, people feel less satisfied with their jam choice?” examples. Tell me about the deep secrets of my brain, so that I know when it is trying to trick me.
US News and World Report offers some baffling advice to incoming first-year college students, starting with the tip to “live with roommates.” (I know this isn’t true for every college, but most schools require incoming first-years to live in the dorms with roommates, right?) The article continues:
One of the easiest ways to cut your expenses is to decrease your living costs. Each roommate you have cuts your living expenses compared to what you would pay living alone.
I mean, sure, but it’s not like most college students are planning on living alone, right? They’ve already figured out this great “lifehack.”
In college, you want to live like a student so that when you are a professional, you can live like a professional. For example, I have a friend who lived by herself in college, paying full price for rent while paying student loans. She lived in a snazzy apartment, traveled and bought lots of clothes. The truth is that she took out student loans for her living expenses and used all of it. Now, she has to have a roommate, can’t travel and lives on a very tight budget.
She has a roommate and a budget and can’t travel? In other words, she’s exactly like a lot of college graduates, as well as adults who have been out of college for years.
My friend did it backward. When you’re in college, you should live like it – have roommates, live cheaply and save your pennies. This way when you’re out on your own, you can actually live like the successful young professional that you are (no roommates necessary).
Ha ha ha ha ha ha ha ha ha ha I’m laughing so hard I’m crying.
But my favorite financial advice for college students comes from Cosmopolitan, which quotes Imgur user Gurltalk’s practical advice to her younger sister:
Buy any kind of notebook you want because it does not matter to your professors. You could probably write on toilet paper if you needed to.
Wait until at least the second day of class to decide if you have to buy the book. Sometimes the syllabus says you need it, but the teacher says you don’t.
You can get birth control at the campus clinic for $7 a month even if you don’t think you will need it. Get it anyway.
That’s financial advice I can get behind. (Also, I should buy rainboots.)
What about you? What financial advice would you give a first-year college student? Later today, I’ll share my financial advice for incoming college students, and we can compare notes.
This story is part of our College Month series.