5 Financial Habits To Develop While Being a Student

by Melissa Burns

When you are a student your adult life seems to be a hundred years away. Thinking about retirement in your 20s while you still likely have a student loan to pay off is so uncommon, but it is important to establish good saving habits as early as possible even if you are on a tight budget.

Regardless of who you are, you should never be dependent on someone else upon your finances because you never know what can happen. Sometimes this message can get lost in our consumeristic culture but let’s review some of the financial habits that can help you become more independent and save for the future.

Credit Score

A credit score is the most important 3 digit number associated with you. If you have a credit card, you have a credit score. Remember that the higher your credit score is, the better interest rate you are going to get.  When you buy a car, house or anything like that you will want to get the best credit score possible. Aim for 720+, this number will bring you the best interest rate. If you have not checked your credit score this year, you’d better do it right now.

Avoid Credit Card Debt

Maybe you have heard from a million people, don’t get a credit card debt. However, having a credit card is the smartest thing you can do as you can earn cashback, rewards and other things that will help you to save more. Whether you want to have a vacation or buy something on Amazon, these things pay off.


The lure of big money always attracts young people to start investing. However, making money in equities is not easy. It not only requires research and patience but also a deep understanding of the market. Before you start investing, get knowledgeable on it.

 Refinance Student Loans

Going to college may cost thousands of dollars, and you need to figure out the best strategy for your student loans. The best thing to do so is to refinance them. There are companies that offer lots of refinancing options. You can also check out a bank you have your student loan, but make sure you pay attention to a few things. Often when you refinance you stretch the time of the loan from ten to even thirty years. This is great for your monthly payment but very bad for the amount of money you will eventually pay.

Individual Retirement Account

The individual retirement accounts (IRA) have become popular among young people that enable them to take control over their retirement savings. The most common types are traditional and Roth IRA. They are easy to set up, and both have their advantages and disadvantages. Because IRA is an investment account, you can invest in bonds, stocks, ETFs, mutual funds, or precious metals.

However, the currency has its shortcomings. It is prone to inflation, and there is no sure fire way of telling what will happen in future. In order to avoid these shortcomings, many people choose gold IRA. Gold has one significant advantage over currency – it cannot be affected by inflation, which is a very important feature when it comes to long-term investment. Taking into account that our economy is anything but stable, investing in gold offers more security against market fluctuations and allows to take control of your retirement.

When you are in your 20s, you may have your first job and just starting to get established. There are a lot of life and relationship things to think about, but you should also be thinking about your money.

Melissa Burns graduated from the faculty of Journalism of Iowa State University. Nowadays she is an entrepreneur and independent journalist. Follow her @melissaaburns or contact at burns.melissaa@gmail.com



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