A student’s entry into a university could entail a lot of things. For instance, it means that a student, in this particular case Chris, would have to live away from his mom and move into a semi-independent environment. It could thereby be considered as a preparation for the new things to come. Chris needs a lot of changes to be able to adapt. He needs to more responsible in this new chapter in his life, bringing along all of the necessary values that he learned upon growing up. He will have needs, mostly academic in nature.
Chris has to have a great deal of addressing these needs with little dependence from his mom because he now lives on his own. This entails additional responsibilities which maybe new to him. Chris is not an isolated case when it comes to budgeting in a university. Everybody went through those adaptations and the processes and means involved may vary from person to person. The difference is, Chris is not from an affluent family. He has to budget his resources well, if not, he will end up starving literally. The case gives us that Chris has a quarterly expenses that averages into $1500.
The thought of managing his personal finances during his days in college can probably be the most crucial thing for Chris to fully appreciate the concepts that the subjects presents. It is in this time that he could say that he have learned things the hard way. Finding out solutions to his financial dilemmas may serve as a guide for his towards his future decisions. These same decisions will teach Chris to think quite a lot of times before he spend, keeping in mind the practical applications of what he will learn in his days in college.
Life has a way of letting us know that things are not permanent and that can be learned in college the hard way. Say Chris has a $500 allowance left. If he spent half of that today, he will suffer for the rest of the quarter. Another concept of financial management which could aptly be applied here is the concept of savings. Saving or rather allocating finances for each day of the week is one thing Chris could effectively do in order to survive (Sebastian & United States. Government Accountability Office. , 2006).
Taking the bus for instance in going to campus instead of using his car could be a good start. He will then save gas costs. But in any case, those savings most of the times serve as a buffer or a fallback each time he may ran short. Probably one of the most effective ways of managing Chris’ finances is the painstaking task of listing his expenses on one of his notebooks which he could browse over at the end of the day so as to assess his spending patterns. It could really help him a lot in managing the money he has and thereby helps him in spending the next day or so.
That don’t mean Chris has to do the debit and credit thing but at least he knows where the money goes. A lot of people can be quite dumb at times especially when it comes to spending allowances from our parents. We have them first day in the week and we live like rock stars spending it like we don’t care. Nothing’s really wrong if we do it, in any case the money is there to be spent but it won’t hurt if we would think twice before spending (Farr, Shatkin, JIST Works Inc. , & United States. Dept. of Labor.
, 2007). One concept in Financial Management that Chris could apply is the concept of alternatives. Well, some things can not really be avoided when it is in front of us. For example, his academic expenses, Chris could use the library and find it practical than being in an internet cafe. Maybe it is, but what if there is a cheaper one around just waiting for us to notice? For example, Chris may find a house to stay in at half the cost in university dormitories. He won’t find it unless he looks for it.
Furthermore, Chris needs to identify opportunities as they arrive in order for him to be able to grasp control of his source of funding aside from the school loan board and his mom (Financial Management Association International. , 2000). As he moves on to his independence, Chris also has to secure a stable source of income. $750 a month of clearance of his accountabilities is a promising remark and that could entail a lot from this lad who is approaching financial maturity.
Opportunities therefore are necessary. For instance, since he likes gaming, attending conventions and joining tournaments could be a source of income. If Chris is really good at it, he could well make a living out of it in college. The opportunity cost however should be taken well into consideration as he also has to attend to his academics. This is one thing that Chris must not be able to forget even if he has to work to support himself. As his teacher said, “Nothing ventured, nothing gained. ”