Living on a grad student stipend is tough, but we often make it harder on ourselves if we don’t know where the money is going. By tracking our spending habits, we can get a better sense of what we value, our motivations for spending, and areas where we can save a few dollars or even a few hundred dollars. Although our schedules our tight, making time to track spending and create a practical budget will pay huge dividends in the long run. Read on for budgeting and money-saving tips!
Figure out where your money is going. Track your spending for at least one month (3 months yields better results) and categorize the expenses. This will give you clues about where you can save money (more on this below). Using Excel is an easy way to track income and expenses, but if you prefer to use apps, here are few to try:
- Android: My Budget Book ($2.59) This app allows you to set up your own categories and subcategories of spending, add recurring monthly bills, and export your monthly expense reports to html, cdv, or back it up in the cloud.
- iOS: Mint (Free) This app allows you to link bank and credit card accounts to track both income and expenses, draw up a budget, and even set alerts when you’re over your allotted spending or a bill is due. This app is also available as a free website.
- Spendee is available on both platforms ($1.99): It’s easy to use and colorful charts help you see quickly and easily where your money is going.
Divide expenditures into wants versus needs. Just a note of caution here - don’t give up everything on your want list, otherwise, you’ll never stick to your budget. If you enjoy drinking wine and don’t want to give it up, consider doing tasting experiments with $5 and under wines at Trader Joe’s (one of my current projects). You’ll be surprised how many wonderful wines you can find that won’t hurt your budget!
Identify categories that are unnecessarily draining funds. For example, can you cut out your daily $5 coffee purchases, make your own at home, and bring it along in a thermos? Can you purchase an inexpensive coffee maker for the grad student office? This can save you $100 or more a month!
Consider your purchasing motivations. Do you turn to shopping (in stores or online) to relieve stress? While things are tight, can you replace this habit with something less expensive, such as going for a walk or calling a friend?
Reduce your bills. Do you need a data-heavy cell phone plan or can you cut back on this and rely on wifi? Consider getting rid of cable or satellite TV for a while or trimming down the package. Check out Lifehacker’s Bill-by-Bill guide to see where you can save money on other common expenses. Liz Homan’s recent GradHacker article on meal planning offers advice to make your money go farther and still eat well. Housing is probably one of your biggest expenses. Consider looking for a roommate, subletting, or alternative housing options, such as graduate student housing on or near campus.
Learn to do things yourself or find out what skills your friends and colleagues have and offer to swap work with each other. Not the best mechanic? Offer to edit and provide feedback on conference papers and articles they’re working on or babysit their children for a couple of hours.
Negotiate. There are many things you can negotiate, such as rent and even interest on your credit card. Don’t be afraid to ask about these things.
Avoid debt, especially credit card debt and loans from private agencies. Talk with your financial aid office to create a plan to get on top of any debtyou currently have and avoid taking on more. Look into the various options to pay off current debts, including SponsorChange to pay off student loans with volunteer work.
Lastly, draw up your budget based on your tracked expenses and the above considerations. Be reasonable and don’t cut out all of the fun. Look at this time in life as an opportunity to be creative, still do some of the things you’d like to do, and know that it won’t last forever.
What suggestions do you have for grad school budgeting? Leave your thoughts in the comments below!
[Image by Flickr user StockMonkeys.com used under creative commons licensing.]