Managing Costs During School

It's hard to make money last, especially if you receive funds only once every three, four, or five months. And that's exactly what happens with your financial aid funds. These funds generally are disbursed once each term at or near the beginning of the term. It's your responsibility to make sure that you budget your funds so that they last until your next disbursement. This can be very difficult. It's like getting paid once a quarter by your employer.

One way to make your funds last is to open a savings account that you can use just for your financial aid funds. Follow these steps:

Step 1
Open a separate savings account for your financial aid funds. Keep your funds there until they are to be used based on your monthly budget.

Step 2
Calculate your monthly spending plan (i.e., budget) to know how much you can afford to spend each month. This amount will become your monthly "allowance."

Step 3
Transfer your budgeted "allowance" to pay all your expenses each month. Ask your bank to automatically transfer your monthly "allowance." This electronic transfer should be from your holding account to your checking account.

You may want to avoid getting an ATM card for your holding account so you are not tempted to draw funds from the account ahead of your monthly budget schedule. If you have to make a trip to the bank in-person instead of running to the nearest ATM, you may be forced to consider whether the extra withdrawal is really worth it.

Certain items in your budget can be pre-paid. You may want to speak with your landlord and arrange to prepay your rent for the entire term when you receive your financial aid funds instead of paying month by month.

Check with your utility companies as well; you may be able to prepay fixed monthly service charges for such things as your cable, telephone, and cell phone. You can usually prepay your car insurance, as well.