Money management do’s and don’ts

BOONE, N.C. — School supplies, rent, groceries, utilities — and pizza. Most students learn a lot about the cost of living while they are in college.

Bryan Bouboulis, senior lecturer in Appalachian State University’s Department of Finance, Banking and Insurance, wants to help students manage their money while in college — and beyond.

“Finance is a part of your life. It doesn’t matter what your major is, or what career you’re interested in,” said Bouboulis, who directs App State’s financial literacy initiative — a program providing money management resources and personal consultations for students.

Bouboulis also teaches personal finance courses for both business and nonbusiness majors, exploring money topics that are relevant “from birth to death,” he said. “College funds, credit cards, qualifying for a mortgage, leasing a car versus buying, planning for retirement — we cover it all.”

For students in college, Bouboulis offers do’s and don’ts in managing money:

Do’s

Do start with a spending plan.

Set a budget and track spending by category — using a spreadsheet, a software program or an app. Bouboulis recommends using a money management app that ties into bank and credit card accounts and provides insight on actual spending compared to budgeted amounts.

“A budget allows you to tell your money what to do, instead of wondering where it went,” Bouboulis said.

Do establish an emergency fund.

A separate fund set aside for emergencies — such as car repairs, a new phone battery or other unexpected expenses — is essential, Bouboulis said. “Having that money set aside helps you avoid using credit, which can become very expensive,” he said.

For college students, Bouboulis advises an emergency fund of $1,000.

Do begin to build a credit score.

Most people will need to borrow money at some point, to purchase a car or home, or perhaps pay for higher education. Credit scores affect the ability to secure a loan, as well as the interest rates for the loan. Credit scores are also used in determining security deposits for utilities and qualifying individuals to rent housing, in some cases.

Careful use of credit cards can help establish a credit score, Bouboulis said. “Only charge what you can easily pay off within a month or two,” he said.

Because credit scores are affected by how long a person has had a credit account, Bouboulis advised, “Get just one card and stick with it.”

Do pay with cash, when possible.

On average, people spend 17% more with credit or debit cards than they do with cash, Bouboulis said.

“When we use cash, we think about it more,” Bouboulis said. “Studies show when you hand over cash for a purchase, pain receptors in your brain are triggered as you think about how hard you’ve worked for the money you’re spending.”

Using a credit or debit card doesn’t produce the same mental connection, Bouboulis said.

Don’ts

Don’t waste money.

“How much do you spend without thinking, on things you don’t need?” Bouboulis asked. Unnecessary Uber rides, food delivery charges or gourmet cups of coffee add up, he said.

“If you spent $5 a day on a latte, that would add up to $150 a month. But if you carefully invested $150 a month instead, you could end up with $3 million by the time you retire,” Bouboulis said.

Don’t borrow more than you need.

Regardless of the maximum loan amount offered on a student loan, Bouboulis said students should borrow only what they truly need.

Financial counselors in App State’s Office of Student Financial Aid, or consultants in the financial literacy program can help students estimate living costs and expenses to minimize the amount borrowed.

Don’t sacrifice your academic success for non-career-related jobs.

“Think about the end game,” Bouboulis said. While a part-time job can help eliminate debt or fund living expenses and fun, balance is key.

“If students have to repeat classes due to overextending themselves, they can extend the time it takes to complete a degree, resulting in higher costs overall,” Bouboulis said.

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Walker College of Business

The Walker College of Business at Appalachian State University delivers transformational educational experiences that prepare and inspire students to be ethical, innovative and engaged business leaders who positively impact our community, both locally and globally. The college places emphasis on international experiences, sustainable business practices, entrepreneurial programs and real-world applications with industry. Enrolling approximately 3,000 undergraduates in 10 majors and 175 graduate students in three master's programs, the Walker College is accredited by AACSB International – the premier global accrediting body for schools of business.

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About the Department of Finance, Banking and Insurance

The Department of Finance, Banking and Insurance develops leaders for business, government and education by offering a Bachelor of Science in business administration in two specializations: finance and banking, and risk management and insurance. Learn more at https://finance.appstate.edu.

About the Walker College of Business

The Walker College of Business at Appalachian State University delivers transformational educational experiences that prepare and inspire students to be ethical, innovative and engaged business leaders who positively impact our community, both locally and globally. The college places emphasis on international experiences, sustainable business practices, entrepreneurial programs and real-world applications with industry. Enrolling approximately 3,000 undergraduates in 10 majors and 175 graduate students in three master's programs, the Walker College is accredited by AACSB International – the premier global accrediting body for schools of business. Learn more at https://business.appstate.edu.

About Appalachian State University

As the premier public undergraduate institution in the Southeast, Appalachian State University prepares students to lead purposeful lives as global citizens who understand and engage their responsibilities in creating a sustainable future for all. The Appalachian Experience promotes a spirit of inclusion that brings people together in inspiring ways to acquire and create knowledge, to grow holistically, to act with passion and determination, and to embrace diversity and difference. Located in the Blue Ridge Mountains, Appalachian is one of 17 campuses in the University of North Carolina System. Appalachian enrolls nearly 21,000 students, has a low student-to-faculty ratio and offers more than 150 undergraduate and graduate majors.