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Saving for College as an Incoming Freshman

College • May 11, 2020 • Ashley Boucher


What you’ll learn

  • Why you should save for college
  • How much you should save
  • College saving options


It’s never too soon (or too late, for that matter) to start developing a strong foundation of financial habits and behaviors. This is especially true for high school juniors and seniors who will be headed off to college soon, where they may be expected to manage their own saving and spending.

Why should an incoming freshman save for college?

Seems like a no brainer but that question comes up a lot. Well, as you probably know by now, paying for college means more than financing tuition. In many cases, students need to pay for housing, textbooks, meals, utilities, entertainment, and gas or other transportation costs like rideshares. There’s also the lesser-talked about-necessities like paper towels, trash bags, toiletries, etc. The list can vary depending on whether you’ll be living on or off campus, but either way, your spending can really add up.

After tuition, how much money should incoming freshman save?

According to College Board’s 2019 Trends in Pricing, full-time students pay $8,600 a year in out-of-pocket living expenses. This number will vary for each student, based on any number of factors. Will you be moving back home during the summer? Will you live on campus or off campus? Will you have a meal plan, or will you be cooking meals at home? Do you pay your own cell phone bill?

The answers to these questions will help determine how much you’ll need to spend each month. Only then will you have a clear idea of how much you’ll need to save.

How can you start saving for college?

When you’re in college, you’ll want to spend your time focused on studies rather than how to make ends meet. To help make sure you’re financially prepared, start thinking about saving and budgeting before you start your freshman year.

Having a plan is half the battle. Here’s where you can start:

Begin with a budget. Maybe you haven’t started thinking about your spending habits yet, but now is a great time to start! A clear picture of your expenses on a monthly basis will give you a solid idea of what you’ll need each month, and how much extra you’ll want to earn or save now to make it happen.

There are plenty of tools out there, like this monthly budget worksheet, to get you started. There’s also a list of monthly fixed and variable expenses from the Department of Education. This is a good listing to start, but don’t forget about the expenses that differ from month to month, like the costs associated with getting to and from school during winter break.

Outline your savings goals. Are you hoping to use your savings to cover all of your fixed expenses, like your cell phone, car insurance, and rent? Or, do you want to cover your variable expenses, like clothing, entertainment, movies, gym memberships, etc.? Or maybe you just want to be able to pay for spring break. Regardless of your specific goals, having an idea of what you’re saving for will help keep you motivated and on track.

Open a bank account (or two). In order to grow your savings, you’ll need a smart and convenient place for your money to accumulate. If you don’t already have a bank account, now is a good time to open up both a checking account and a savings account. Having both accounts will help you categorize your funds, making it less likely to overspend, and easier to save.

Find a bank that is convenient for you – it should have locations and ATMs near your college campus (and your home, ideally), have a low (or no) minimum balance requirement, and offer features like mobile deposit and online bill pay.

Automate your savings. If you have a regular source of income (a part time job, allowances, etc.), it’s a good idea to build automated savings into your routine. Essentially, you’ll be turning your savings account contributions into a monthly expense.

If you receive a paycheck, you can allocate a portion of it to go directly to your savings account. This way, it’s money that you don’t have to think about. Before you know it, your savings account will be growing, and your college budget will be taking shape.

Next steps for saving for college as an incoming freshman

After you’ve taken those steps to making saving for college as an incoming freshman more feasible, here are some additional opportunities to consider:

Use your phone. Did you know a key tool in growing your savings is already in your pocket (or maybe even in your hand, right now?) That’s right – your cell phone is a huge asset in making sure you can successfully save. By downloading your mobile banking app (remember to choose a bank that has a mobile app!), you can easily transfer funds into your savings account, and monitor your savings progress on a regular basis. There are also a few different mobile-savvy apps to help you save even more. For example, Simple and Qapital are both free apps that let you round up your daily transactions and place the ‘spare change’ into your mobile account. If you spend $2.80 on a coffee, for example, $.20 will go into your account. This is the technological equivalent of emptying your pockets every day and putting the change into a mug or piggy bank.

Consider a part-time job. If you still have a summer or two before college, you might consider a part time job or paid summer internship. The benefits are endless: you’ll start to build your resume, gain experience working with people, and start to earn money! The different types of jobs range from working in a movie theatre, your local ice cream shop or bank, or ‘odds and ends’ gigs like dog walking, babysitting, or yardwork.

Sell your unwanted goods. The benefits of selling some of your unwanted or unnecessary items are endless! You can help others in need, enjoy the clarity a clutter-free space can bring, and potentially earn some cash for your piggybank. That said, there is some prep work required.

First, what don’t you need anymore? A good place to start to find items you can part with might be your closet. What haven’t you worn in a year? What no longer fits? What could help someone else?

Next, find a consignment store and see what they may pay you for! Items that are clean, without holes or tears are good to consider. If you don’t have a local consignment shop, you could host or join a community yard sale, or post on local Facebook pages geared toward selling.

Turn gifts into savings. If you’re lucky, your graduation may be celebrated by family and friends with a party, or even gifts. And if you’re fortunate enough to receive money for graduating high school, you might be inclined to ream up lavish or ‘fun’ ways to spend it. Instead of quickly spending whatever you receive, consider putting a portion of it away for savings. If it helps, you can even tag it as savings for a particular expense you’ll incur while in school, like textbooks or groceries.

How much should you save for college?

Every dollar saved for college is a dollar you don’t have to spend out of pocket or borrow. That said, it may be unrealistic to think you’ll save the entire amount needed to pay for college. After all, you’d be accounting for tuition and fees, room and board, books and supplies, transportation, etc. This can add up. So, how much do you need to save?

Start with a goal that’s a little easier to manage. Instead of wondering how much you should save for college, ask yourself how much you can afford to save each month. If you’re already in high school and planning to save, you have from a few months to a few years to divide your goal into months. Let’s say you’re an incoming freshman, or high school senior, and you want to save enough to cover your textbooks. According to the College Board, the average undergraduate will spend about $1,240 a year on books and supplies. If you’re at the start of your senior year in high school, you have about 12 months or so left to save. In this case, if you set a monthly goal, it’d be about $103 a month.

Where should you save money for college?

There are a ton of options on where to save your money, but look for a few key features and benefits:

  • Low (or no) monthly fees, which would include no ATM fees or even overdraw fees. And, look for an account that does not require a minimum balance. While the goal is to save as much as possible, you don’t want to be penalized when you withdraw funds to cover supplies.
  • Location is key, even for your bank. Check to see which banks have ATMs on campus or near your housing. If you need to access your savings account in a pinch, you don’t want to have to search high and low for a place to do it.
  • Online banking – especially mobile. You want to be able to make deposits and transfers from your dorm room, classroom, or wherever you are. This can be done through a bank that offers a solid mobile app or online banking option.

What other college savings options are available?

Once you’ve developed your plan to save and explored options to keep your money, it may be time to consider what other college savings options are available.

Sometimes, the savings come in the form of scholarships, or free money! Make sure you exhaust all options to find scholarships, including your school or college counselor, your college’s financial aid office, the Free Application for Federal Student Aid, and even free, online resources like the Sallie Mae Scholarship Search Tool (home to more than $24 billion in scholarship dollars!). This money is money you don’t have to repay (or save), so use your senior year to pile up the scholarship dollars – and save more of your hard-earned cash for unseen expenses once you’re in school.

An option for long term savings is especially relevant if you plan to borrow money for school by way of student loans. For private student loans, you can often opt to pay a small fixed rate, or the interest on your loan, while you’re in school. This small step can help you save money on the total cost of your loan.

Regardless of how you go about saving for college as an incoming freshman, you’re onto the first step: creating a plan. Remember to set realistic goals and means to achieve them, and you’ll be headed off to college with a budget and a bank account, ready to tackle what’s next!


Ashley is a Sallie Mae employee and a graduate of Immaculata University. A mom of two young girls, her favorite dinner topic is the Free Application for Federal Student Aid (FAFSA).


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