When my nieces and nephews graduate from high school and begin their college careers these are the things I will have written down on paper to present to them. These are mistakes that I made that in the long run cost me, or kept me down either in debt or in poor career moves later in life. These are simple mistakes that are easy to get trapped in if one is not careful and disciplined.
1. If you get money as a gift for graduation do not spend it. Instead, take all the money you have accumulated and put it into an interest bearing savings account, or if there is enough, put it all into a CD (cash/certificate of deposit) that has a minimum one year payout. This does several things. First, it teaches you to save your money. Second, it causes that money to grow into more money, and third, it allows you to have a cash reserve for unexpected occurrences while you are in school.
Try to avoid taking loans for your education. This is the easiest way to actually pay for college if you have no money saved, but it is also the easiest way to put yourself into a prison of debt that you will be paying for years, sometimes even decades after you graduate. Research and attempt to get money from any other possible avenue such as grants, scholarships, fund raising, etc.
While you are in college, do not apply for those nice little credit card offers that are hanging on the wall of the registrars office, or that are being passed out on campus. These offers are "traps" on various different levels. First they have sweeteners attached to them, a cool looking t-shirt, or some type of gift. Second, once you have applied and received the credit card it is quite easy to get into the habit of charging on it now because you do not have to pay it back until later. Third, never use them to try and keep up with your friends spending. It is not necessary to keep up with the “Jones’”. These are all traps that can put you into serious debt and like your school loans you could end up paying off for many years to come.
Stick to buying used books from the bookstore. Get to your college bookstore early and buy all the available used books for your classes. This can save you hundreds of dollars in the long run. Moreover, sell back the books you know you will not need or that you do not want. You will not get much back for them, but if you buy them used and sell them back, the little bit you get can help you buy your next set of books for the upcoming semester. Keep in mind that college texts are usually updated every other year, so if you wait too long to sell your textbooks, the school may not take them back due to a newer version.
Buy a meal ticket and eat in the college cafeteria if possible. This will save you money in the long run. You will be tempted to go with your friends out to eat every time they want to go, but you must decide if you are willing to save money. An alternative to this is taking the money you earned from your graduation money (from #1) and budget the earnings to go out and eat with your friends after your first year in school.
Get a part-time job on campus or off campus if you are able. Budget this money for events with your friends. However, always remember that a portion of everything you earn is yours to keep. So decide how much (dollar or percentage amount) you would like to take from your earnings and then invest that portion in an interest bearing account (high yield savings, CD, or money market account for easy liquidity if needed)
If you honestly think you would like to wait a few years before going to college, then wait. I made this mistake and it cost me thousands of dollars which I have spent the last 15 years paying back. If you would rather go into the work force, or do something other than college, or you think you are simply not ready to begin college (perhaps you are burned out of the past 12 years of school), then it is best to wait. However, if you decide to wait, then prepare yourself to actually attend when you think you are ready. In other words, work and be sure to save money for school, that way when you are ready to go, you will have saved money to pay school expenses and avoided putting yourself into debt. Also, when you go to college, make sure you know exactly what you want to accomplish, what area of study you want to pursue, this will save you both money and time in the long run.
In the long run, if you take these basic things into consideration it will save you years of grief over simple mistakes that could have been avoided. Being prepared, disiplined, frugal, and a good manager of your money at an early age will only make you much stronger both financially and as a worker in the work force later on. Moreover, if you decide, when you graduate college, to open up your own business and you have avoided the "debt trap," this will help you and your business venture get off on the right financial foot.
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