By Sarah Kaufman, Manilla.com

Sarah Kaufman is the managing editor of the Manilla Blog and money-saving contributor from Manilla.com, the leading, free and secure service that helps consumers organize and simplify their daily lives by managing everything in one place. Using just one password, customers can manage their finances, bills, daily deals, student loans, travel rewards, magazine and Netflix subscriptions and more — all through Manilla.com or the top-rated mobile apps. For more financial tracking & budgeting advice, visit Manilla.com.
 
I was lucky enough to graduate from college without acquiring any student loan debt, so when I decided to take out thousands of dollars for grad school loans and living expenses, my father was less than thrilled.
 
He advised me that it was not a great idea to be borrowing so much money, especially for living expenses. “It’s not free money,” he told me. “Remember, you have to pay it back.”
 
Logical though his advice was, it went in one ear and out the other. I borrowed as much as I could so I could afford the lifestyle I wanted, and I never bothered to budget or save. Whenever he talked about what I should be doing with my money, I tuned him out, refusing to listen to his sensible tips. Why? Probably because it was coming from him.
 
While not all college students are as careless and impractical as I once was, they’re also just coming into the my-parents-can’t-tell-me-what-to-do phase. For me, that phase lasted a long time. I wish I had been mature enough to listen to my father, who knew how to manage his finances based on experience and smarts, but it wasn’t until much later that I realized he had been right.
 
That’s why it’s important to have another reasonable voice, such as from an Auntie like you, to help young college students navigate the trenches of money management. Based on my own experience — and a mountain of debt — I’ve come up with a few things you can tell them that would have helped me:
 
Budget early.
Embrace the fact that you’re young, preoccupied with a full-time class schedule, possibly jobless, and therefore, probably penniless for the time being. In order to make the money you do have work for you, compose a budget that makes sense for your lifestyle. If your parents are still helping you pay for your bills, that doesn’t mean you should stop paying attention to your finances. If your parents give you a certain amount of money for food each month, make sure to stick to that amount so that you can avoid making the “Mom, I need money” call.
 
If you’re already starting to pay your own bills, add up all of your absolutely necessary expenses (e.g., books, food, etc.), and then subtract the total from your monthly income, whether that comes from an after-school job or from your parents. The remainder is what you have to spend on everything else: clothes, entertainment, and other luxury expenses.
 
Pay your bills on time.
In the short term, failing to pay your bills on time could result in a few hefty late fees. But in the long term, it could lead to the demise of your credit score. Building credit is important for doing all kinds of things, such as buying or renting a home, improving your insurance rates and increasing your employment options. Whether you’re still in college or you’ve already graduated, you can train yourself to pay your bills on time by using a free bill organizing service, such as Manilla.com, which sends text or email reminders when you’re bills are almost due.
 
Never bounce a check.
You should never write a check if you’re not 100 percent certain you have enough money in your checking account to cover the cost. Not only is doing so completely irresponsible, but it’s also avoidable. Most banks now offer overdraft protection, which allows you to link your checking account to a savings account or credit card. That way, if you do overdraft, you won’t be hit with a penalty fee.
 
Credit cards are not free money!
The scariest part about having a credit card is completely psychological — this idea that if you have one, you’ll acquire endless debt and you’ll be up to your ears in immense payments for the rest of your life. In reality, your credit situation is what you make of it. You can have a credit card, which is necessary to build credit, without getting yourself into debt. Early on in life, the best way to use a credit card is to use it for one monthly expense, such as gas or groceries, which you carefully watch and then pay off the balance in full each month. Avoid only paying the minimum balance — doing this will result in paying much more in interest over time.

Photo: stockimages
Published: May 21, 2013