Cash at College: Spending, Saving & Student Loans (Recorded Webinar)

Cash at College is a must-see webinar for all students headed to college. University of Illinois USFSCO’s Student Money Management Center and University of Illinois Extension have teamed up to offer this educational and engaging webinar for all University of Illinois students. This free webinar features lessons on:

  • how to effectively budget your money while in college
  • the basics of banking
  • options for paying your college tuition
  • understanding credit
  • and how to make the most of your college education

Cash at College offers an important guide to managing your finances, so don’t miss out! Watch it below or on YouTube now!

Test your knowledge. Take the quiz!

Spending badgeThis is a Spending Badge eligible program, so make sure to take the quiz after watching to get credit!

By participating in three Spending Badge eligible events, you could earn a digital badge to enhance your online professional portfolio. Learn more about the Financial Literacy Badges Program by visiting: badges.illinois.edu/usfsco/.

Why get a savings account?

The most noticeable benefit of a savings account is interest earned on money deposited. The interest rate on a savings account is currently very low, but it still provides extra money. A savings account has many characteristics of a checking account, but it offers other benefits. A benefit of having a savings account is that it can create a saving mindset. Finally, a savings account will provide additional security.

A savings account annual interest rate is, as of April 2015, ranging anywhere from .05% to 1%. This may not seem like a high number, but it is still creating money. For example, 1% of a thousand dollars is ten dollars. Current rates can be checked regularly through your institution’s website or other online sources such as http://www.bankrate.com/.

A savings account is a great offer because it has very high liquidity. Liquidity measures how quick an asset or any financial instrument can be converted into cash (usually into a checking account). The process is as simple as doing a quick online transfer from savings to checking. In addition to having liquidity, a savings account is backed by the FDIC in conjunction with a bank’s checking account, or the NCUSIF if your saving account is with a credit union. Your account is insured up to $250,000. (Personal limits also apply if you have multiple accounts.) Basically, a savings account provides interest with zero risk on savings up to $250,000. Specific variations on a savings account, like a money market account, may provide higher interest rates but may limit the amount of transactions that can occur. It is important to talk with a bank or credit union representative to figure out which account fits your needs.

Besides earning interest, savings accounts are great for creating a saving mindset. First, while savings accounts are liquid, the money is set aside from regular checking. This makes it more difficult to spend unexpected amounts of money on any good or service. The process of transferring money from savings to checking creates time to mull over the decision and can prevent unnecessary expensive purchases. However, the money is still available and accessible in times of emergency. Next, taking extra income and depositing into a savings account can develop a mindset more geared towards saving. Saving money is important for achieving future financial goals, and a savings account is the first step in saving and earning interest income.

Finally, a savings account can create additional security for money stored in an account. For example, a savings account has a different account number than the checking account, so if account information were to get stolen, the savings account funds would remain difficult to be stolen. It is a good idea to not link your debit card to your savings account. This will create an extra barrier if your debit card were to get stolen.

In conclusion, a savings account is a great complement to a regular checking account. It provides many of the same features of a checking account but earns interest on the money deposited. It also allows you to create a saving mindset which is important in the long run. Savings accounts can also come in many different styles, so it’s important to contact your financial institution to figure out which is right for you!

Written by Jonathan Alton, Financial Wellness for College Students Peer Educator, and Kathy Sweedler, Consumer Economics Educator, University of Illinois Extension

I spend a lot of money on eating out. How can I reduce those expenses?

While it’s true that one of your biggest expenses will always be food, there are many ways for you to cut down on those costs. Buying groceries and cooking at home can be less expensive and much healthier than eating out, but we all have busy schedules and sometimes don’t have the time or resources to cook. Here are two ways that you can save money when you want to eat out!

  1. Coupons are not just for families. If you live in an apartment or house (and sometimes even in the dorms), many restaurants and chains will send coupons in the mail that can save you a good amount of cash. For example: One national pizza chain’s large cheese pizza regularly costs $12. Use a coupon that was mailed (or even one you found online) and you can get a large pizza plus two toppings for $8!
  2. If you don’t have coupons or need a good deal in a pinch, there are also websites that offer deals in the area. For example, EatCU.com offers deals from over 100 restaurants including “weekly specials” that can help you save even more money. Another online local coupon source is campusspecial.com. You can search for deals at UIUC specifically, or if you’re visiting someone at another university (they have deals at over 500 schools), you can enter that school and get coupons even when you’re in an unfamiliar place.

Even the smallest amount of money saved can add up to something big. Don’t hesitate to spend a little extra time trying to save on your meal–it could end up saving you a lot of money in the long run!

Written by Sophia Mohamed, Financial Wellness Peer Educator, University of Illinois Extension

Expect the Unexpected – Saving for Emergencies

Planning for the unexpected can ensure that you are able to weather a financial hardship should you lose your job, have a car repair, or any other unplanned expense. By having savings set aside for emergencies, you decrease the need to rely on credit cards or loans to cover emergency situations. Borrowing funds to cover emergencies can create additional financial hardship. Most experts recommend that you have between three and six months of income set aside in emergency funds, but having any money set aside can help when a financial storm arises.

A recent survey has found that “18- to 30-year-olds are the most likely to have up to five months’ expenses saved up since they might have the benefit of lower expenses due to having roommates, living with their parents or being students.” Your college years can be an ideal time to create and build your emergency savings.

If you’re not sure how to start saving for an emergency, here’s a crash course in what to look for:

  • Prioritize your spendingneeds come before wants. If going without something could cause you physical pain or injury (like water, shelter, food, medications or proper clothing), then it’s probably a need. If you could get by without it, it’s likely a want.
  • Analyze areas of opportunityidentify ways you can save. If you cut out a $4 beverage or snack just once a week, you could save over $200 a year.
  • Save extra moneyturn birthday money into a rainy day fund. If you don’t have regular income, putting away gift money or profit you make off selling unused items can help start your emergency fund.

Getting Through Tough Financial Times is a resource developed by University of Illinois Extension to help individuals and families weather financial storms. This site provides information on spending habits, managing finances, and smart savings strategies.

Written by Sheri Williamson and Andrea Pellegrini, University of Illinois USFSCO Student Money Management Center