# Saving for Smaller College Expenses Can Make a Big Difference

Put your summer earnings to work for you instead of spending it all.

The end of the year has arrived and summer is upon us. Have you decided to get a summer job to earn a little extra cash before coming back in the fall? Put your summer earnings to work for you instead of spending it all. You probably won’t be able to save enough to cover the upcoming year’s tuition and fees, but you may be able to set aside enough for your books and supplies.

What can you realistically save for this summer? Make a list. You can’t make a plan if you don’t know exactly what you are working towards.
If you don’t already have one, open a savings account. Putting money you plan to use in the future in a separate account is important so you aren’t tempted to spend the money.
Determine how much you will need. You should be able to find which books you need for your class on the bookstore website.
Divvy up your total cost by the number of paychecks. Calculate how much you should put away out of each paycheck. For example, if you are paid twice a month and plan on saving \$1,000 over the summer so you can buy your books and a reasonably priced laptop, You will need to save about \$166 from each of your paychecks, sounds easier than needing \$1,000 by the end of only a few months.

You may not think that saving over the summer is important because you can always use student loans or a credit card to get the things you want and need. But, remember that there is a cost to credit. You will still be paying for these things in the future, but they will end up costing you more because you will be paying interest.

If you put \$1,000 on your credit card with an 18% interest rate and only make a payment of \$25 per month, it will take you over five years to pay off and cost you over \$1,500 (that’s about \$500 in interest). If you used a student loan at an interest rate of 5.05%, you would end up paying about \$300 more in interest for the \$1,000.

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