Budgeting and building credit early can help prepare students for life’s expenses

In 2018 Grad Guide, Features
(Treva Flores / Daily Titan)

Moving out for the first time can feel like a leap of faith, but with the right budget it doesn’t have to be.

Brennen Clark, a third-year Cal State Fullerton student, and his girlfriend, Jocelyn Olide, recently moved into their first apartment together. The process took them about a month as they searched for a place that fit their budget and allow them to keep their puppy, Goggles.

“There weren’t a lot of options, but because (the rent) was expensive I did get another job first,” Clark said.

Clark works at AMC Theatres and tutors while Olide works at Trader Joes. Each time they get paid they lay out their money in cash and label where that money needs to be spent.

(Treva Flores / Daily Titan)

They save what they can by driving and eating out less.

“We have a giant change jar. I work at a movie theater and I find a lot of change,” Clark said

Bryan Urbina, a bank teller at Altura Credit Union, said people shouldn’t buy expensive items like a car or an apartment unless it’s in their budget.

“Don’t make the mistake of buying a car as soon as you start working. That’s what I did … a lot of money that I could have been saving from the start went into that car,” Urbina said.

Sandra Worthan, Branch manager of Altura Credit Union, said she notices many young people make the mistake of not budgeting, which leaves them without the necessary funds to pay bills.

Worthan recommends students start building their credit early and learn how to budget to avoid fees.

“It’s important to be able to start building credit wisely from a young age, because credit does play a big part if you are in school and doing student loans,” Worthan said.

Urbina said the best way to build credit is to only use a credit card for necessities such as rent, insurance, gas and food.

Another common mistake young people make is not saving up an emergency fund. Worthan said the standard rule of thumb is to put away 10 percent of each check into an emergency fund, but this may not be realistic for everyone.

“Save what percentage works best for you. If you stick to that you’ll see it build up,” Worthan said.

Most importantly, Urbina said people should understand what a real emergency is and actually put money away in case of one.

“The best way to save money is to actually save money. To put the money into a savings account or wherever you’re saving it and just leave it there,” Urbina said.

However, Clark and Olide said they wouldn’t be able to afford their apartment without the help they receive from their parents.

They split their rent three ways with each of their parents, but pay for their own utilities, wifi, renter’s insurance and food.

“It’s a good experience to have (family) help you move in,” Olide said. “At the end of the day it’s like they gave you a home and they’re helping you build a home for yourself.”

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