Happy new year!!!  I know that most people celebrate the new year on January 1.  But for those of us who live our lives in higher education, the new year always starts in late August and ends in mid-May. The months in between are simply a big blur of trying to squeeze in some vacation time while still working at breakneck speed to make sure everything is ready in time for the new year.

For many folks the new year involves making resolutions.  And a very popular resolution is about building a budget to manage your money.  If that B word scares you, call it a spending plan instead.  It somehow sounds less like a punishment and more like a goal that way.  Unless you are independently wealthy (which is rare among students), a spending plan of some sort is a necessity to make sure you have enough money to get through the semester.  Otherwise you could find yourself surviving on a menu of ramen noodles three times a day by the time you get to exams, when you most need some decent nutrition to power your brain.

There are a lot of online tools available to help build a spending plan.  I’ve tried a bunch of them, but I always end up coming back to a good old-fashioned spreadsheet.  It’s tried and true and does exactly what I want it to, giving me flexibility to manipulate and analyze my own data.  I like to start with my monthly income—that stays the same every month.  Then I subtract fixed expenses like my housing, insurance, debt payments, and utilities.  Then what is left over is what I have left to divide among the things that can be flexible from month to month, like food, gasoline, entertainment, medical expenses, and clothing.  All of these are necessary in my life, but I can spend varying amounts depending on the month.  If I spend more in one category, I may have to carve it out of my spending in another category.  And I always put some money in savings each month for future emergencies to prevent the need for future adjustments to my normal spending plan.

Things work a little differently for students living on student loans funds during the academic year.  You may be receiving a large refund at the start of the semester that you need to portion out over the full semester.  I generally recommend putting the lump sum into a savings account.  Some of the online banks are actually starting to pay a somewhat reasonable interest rate again, rather than just a fraction of a percent, so a savings account can actually earn you a bit of money.  Then each month you should transfer a designated amount to your checking account, so it is more readily available for that month’s expenses.  But once that month’s money is gone, don’t let yourself transfer more until the next month’s designated “pay day.”  That will make it easier to keep some control over your spending plan.

It’s the start of a new year.  It’s a fresh start.  New semester.  New classes. New people to meet. For many, a new place to live.  A new spending plan.  Now is your chance to get the year started right.  Happy new year!!