Budgeting for College: Money Wisdom

Gary Moore, Andrea Morgan, Melissa GreensladeProgram CoordinatorsUniversity of Arkansas, Office of Financial Aid

Budget:-A budget is a sum of money allocated for a particular purpose.

Income

Financial Aid Refund Check

Parental Contribution

Savings

On Campus or Off Campus Job

◦ Remember taxes—approx. 1/3 of gross wages

Need:-Necessary for a person to live a healthy life.

-Needs are distinguished from wants because a deficiency would cause a clear negative outcome, such as dysfunction or death.

Want:-Something that is desired.

-There may be unlimited wants, but limited resources. As a result, one cannot have everything one wants and must look for the most affordable alternatives.

vs.

-A duty or obligation to satisfactorily perform or complete a task. 

*You are responsible for paying the bills/debt that you incur for needs and wants.

Responsibility:

BillsRentUtilitiesTuitionBooks/Supplies

Debt IncurredCredit card debtPay back loans

*plus interest and fees

Four Walls

Housing (Shelter)◦On/Off Campus, Rent/Mortgage◦Roommates

Food◦Groceries vs. Eating Out

Utilities (Heat/Air)◦Water, Trash, Electricity, Gas◦Conserve, Recycle

Clothing

Transportation◦Car Payment, Gas,

Maintenance, Insurance◦Exercise

Technology◦Internet, Cable, Cell Phone

Medical Expenses◦Insurance/Out of Pocket◦Doctor Visits◦Medications

Other Needs ?

Savings

Emergency Fund◦$500-$1,000

6-month Emergency FundSavings

◦10% of income◦Long-term goals?

Are you a Saver or a Spender?

What would you do?

You make $1200 a monthYour monthly needs total: $600Your monthly responsibilities total: $100

How much should you save?

How much do you have for spending money?

How Much Time Will It Cost You?

NOW: Work 20 hours/week Hourly Wage: $7.25 1 hour of work after

taxes = $4.84 Weekly Wages: $145 1 week of work after

taxes = $97

$100 pair of jeans.It will cost you

21 hours of work.

FUTURE: Salary: $32,000 Work 40 hours/week Weekly Wages earned:

$615◦ After taxes: $410

Daily Wage: $123.04◦ After taxes: $82.08

Student loan: $30,100 (10 years to repay)

4-6% interest: $47,520Repayment: $82.50/wk

It will cost you a little more than 1 day a week

for 10 years.

Maximum Student Loans Suggested

Source for starting salaries: 5/23/11 article of The Chronicle of Higher Education

Don’t borrow more than you need!

ProfessionStarting Salary

Max Advised Loan*

 

Law $53,500 $42,800 *The  maximum advised loan is based on therepayment over 10 years using approximately 

8% of annual incomeEducation $43,000 $34,400

Psychology $41,000 $32,800  

Kinesiology $61,000 $48,800  

Business $62,500 $42,000  

Biology $56,000 $44,800  

Computers/Math $74,000 $59,200  

Engineering $87,500 $70,000  

Communications $48,000 $38,400  

Health $72,500 $58,000

American Spending Habits

StarbucksEntertainmentGasClothes

Cautions about Credit Cards

The $100 Pizza!For emergency vs. regular useSpending future incomeInterest costsAffects your future

“Financial freedom is not determined by how much money you make. It is

determined by how you use the money you have.”

Tools

◦Budget Plan◦Checking account check registers◦www.feedthepig.org◦Financial Literacy Seminars

Tell your money where you want it to go rather than wondering where it went.

Budget PlanBUDGET PLAN Calculate your semester budget by entering your information in the charts below.Assumptions: A semester consists of 5 months  FINANCIAL AID   Per Semester Financial Aid Refund Per SemesterPell Grant  $0.00 Financial Aid Awards $0.00AR Challenge/Other State Aid $0.00 Tuition & Fees $0.00  Subtract this amountOutside Scholarship A $0.00 Housing (on campus) $0.00  Subtract this amountOutside Scholarship B $0.00 On Campus Meal Plan $0.00  Subtract this amountSubsidized Loans $0.00 RazorBucks $0.00  Subtract this amountUnsubsidized Loans $0.00 *Refund Check Amount $0.00Other Aid (do not include FWS) $0.00 *(Find this amount in ISIS under Student Bill)TOTAL AWARDS $0.00

JOBS Pay Rate # of Hours per Week Weekly Pay Bi-weekly Pay Monthly Pay Semester TotalOn or Off Campus Job (include FWS) $0.00 0 $0.00 $0.00 $0.00 $0.00TOTAL $0.00 0 $0.00 $0.00 $0.00 $0.00

Income Per Month Per Semester Notes TOTALFinancial Aid $0.00 $0.00  $0.00On or Off Campus Job(s) $0.00 $0.00  $0.00Parent Contribution $0.00 $0.00  $0.00TOTAL $0.00 $0.00 $0.00

Expenses Per Month Per Semester Notes TOTALHousing (off campus) $0.00 $0.00  $0.00Utilities (electric, gas, water, trash) $0.00 $0.00  $0.00Food/Groceries $0.00 $0.00  $0.00Transportation(car pymt, insurance, gas) $0.00 $0.00  $0.00Text Books/School Supplies $0.00 $0.00  $0.00Medical/Dental $0.00 $0.00  $0.00Internet, Cable, Cell Phone $0.00 $0.00  $0.00Debt Repayment (loans, credit cards) $0.00 $0.00  $0.00For Emergencies (10% of income) $0.00 $0.00   $0.00Clothing/Gifts $0.00 $0.00   $0.00Entertainment $0.00 $0.00   $0.00Other $0.00 $0.00   $0.00TOTAL $0.00 $0.00 $0.00

Net Discretionary Funds Per Semester $0.00

Budget Plan: Financial Aid

Assumptions: A semester consists of 5 months  FINANCIAL AID   Per Semester Financial Aid Refund Per SemesterPell Grant  $0.00 Financial Aid Awards $0.00AR Challenge/Other State Aid $0.00 Tuition & Fees $0.00  Subtract this amountOutside Scholarship A $0.00 Housing (on campus) $0.00  Subtract this amountOutside Scholarship B $0.00 On Campus Meal Plan $0.00  Subtract this amountSubsidized Loans $0.00 RazorBucks $0.00  Subtract this amountUnsubsidized Loans $0.00 *Refund Check Amount $0.00Other Aid (do not include FWS) $0.00 *(Find this amount in ISIS under Student Bill)TOTAL AWARDS $0.00

Budget Plan: Income

JOBS Pay Rate # of Hours per Week Weekly Pay Bi-weekly Pay Monthly Pay Semester TotalOn or Off Campus Job (include FWS) $0.00 0 $0.00 $0.00 $0.00 $0.00TOTAL $0.00 0 $0.00 $0.00 $0.00 $0.00

Income Per Month Per Semester Notes TOTALFinancial Aid $0.00 $0.00  $0.00On or Off Campus Job(s) $0.00 $0.00  $0.00Parent Contribution $0.00 $0.00  $0.00TOTAL $0.00 $0.00 $0.00

Ideas for Generating Income

Work-study, On-campus Jobs◦ https://jobs.uark.edu/applicants/jsp/shared/Welcome_css.jsp

Off-campus Jobs◦ Babysit/Pet Sit/House Sit/Personal Assistant◦ Tutoring, Translating

Research Participation◦ http://vpred.uark.edu/184.php

Sell Textbooks, Electronics, etc.◦ Craigslist, eBay, Amazon.com◦ Garage Sale

Budget Plan: Expenses

On campus vs. off-campus housing/food/RazorBucks

Expenses Per Month Per Semester Notes TOTALHousing (off campus) $0.00 $0.00   $0.00Utilities (electric, gas, water, trash) $0.00 $0.00   $0.00Food/Groceries $0.00 $0.00   $0.00Transportation (Car pymt, insurance, gas) $0.00 $0.00   $0.00Text Books/School Supplies $0.00 $0.00   $0.00Medical/Dental $0.00 $0.00   $0.00Internet, Cable, Cell Phone $0.00 $0.00   $0.00Debt Repayment (loans, credit cards) $0.00 $0.00   $0.00For Emergencies (10% of income) $0.00 $0.00   $0.00Clothing/Gifts $0.00 $0.00   $0.00Entertainment $0.00 $0.00   $0.00Other $0.00 $0.00   $0.00TOTAL $0.00 $0.00 $0.00

Net Discretionary Funds Per Semester $0.00

Spending and Saving Tips

Coupons/Discounts, Sales/SpecialsGroceries vs. Eating OutBuy Used; Textbook Rental ProgramExercise vs. Car ExpensesFree Events and EntertainmentGive yourself an allowanceLeave your credit/debit card at homeAsk, “Do I really need this?”Remember the cost of credit

Examples

Spring Break!◦ Income; Housing; Food; Transportation;

Entertainment

Interactive Budget Plan

7 Things a BudgetCan Do for You!

1. Know what is going on2. Control3. Organization4. Communication5. Take advantage of opportunities6. Extra time7. Extra money

Before you go…

Evaluation Forms

PowerPoint and Budget Plan are posted on our website

Thank You

Contact Information:◦ Office of Financial Aid: Andrea, Gary, or

Melissa◦ Campus location: 114 Silas Hunt Hall◦ Phone: 479-575-3806◦ Fax: 479-575-7790◦ Website: http://finaid.uark.edu/ ◦ And find us on Facebook at University of

Arkansas Financial Aid!