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Three Steps to Less College Debt

There’s no doubt that college can be one of the most incredible times in a young person’s life. There are people to meet, academic challenges to conquer, and much more freedom than ever before. Unfortunately, one negative aspect of this newfound freedom is that many college students take on significant amounts of debt. In fact, Forbes recently reported that “student loan debt in 2019 is the highest ever.”1

Keep in mind that student loan debt is only one part of the potential debt burden. Many students also opt for consumer or credit card debt during hard times. Both are potentially good options, when used wisely. Problems can occur, however, with lack of experience or proper budgeting.

Unfortunately, when many people hear the word budget, they often think of something restricting or unpleasant. The truth is that a budget can help teach you how to get through college with as little debt as possible. Consider these three steps for putting yourself on a path toward more savings, less debt, and better overall financial health.

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Step 1 — Assess Your Spending
Not all people get into debt because their spending is out of control. You might imagine that those who end up with debt are off the rails, buying designer clothes or going on lavish spring break trips. The truth is an education can be expensive (tuition, books, basic living expenses). Managing a household, paying expenses, and keeping your grades up for the first time is a challenge that takes practice to master. Our advice is to be mindful. Pay attention to your spending, and be certain you’re taking care of necessities before indulging in the extras. If you would like to graduate from college with some savings and as little debt as possible, you might have to go without some experiences. Take a long hard look at your spending to make sure it’s aligned with your hopes for life after graduation.

Step 2 — Create a Budget
Even if your parents are footing the bill for school and giving you an allowance, a budget is still extremely helpful. Set specific amounts you are planning to regularly spend and save each month, and make sure you can cover the basic expenses (food, rent, utilities, transportation, and savings). Remember that a budget is a tool that doesn’t necessarily need to be restrictive. It should reflect reality and indicate where your money is going. With a budget, at the end of the month (or even better, at the end of each week) you can track your spending to see how you’re doing.

Step 3 — Consider Increasing Your Income
If there is a disconnect between what you should be spending and what you are spending, you have two choices: You can either cut back on your spending or increase your income. If you feel like your spending is under control, consider finding a part-time job if it won’t interfere with your academic goals.

Ultimately, if you maintain a detailed budget and exercise some discipline, your future self will thank you for working toward your savings goals.


1 Student Loan Debt Statistics In 2019: A $1.5 Trillion Crisis