2008 Woodie Awards
Save money while in school
Rachel Cabamongan
Issue date: 12/10/07 Section: News
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The first step is to create a plan and realize there are expenses that can be eliminated or downsized, said Nicholas Sahim, a financial adviser for BancWest Investment Services, Inc.
"Start with a log or journal of your bills and income and log absolutely everything going in or coming out of your account," Sahim said. This is important because it provides a visual aid of committed expenses, such as rent and food, or discretionary expenses, such as a trip to the nail salon or beer money.
Segregate expenses between the committed and the discretionary, making sure that the committed expenses are accounted for. Money left over can be used for discretionary expenses or saved.
Sahim explained that the segregation acts as a forceful reminder: "If I spend this $400 I need to put away for rent at the end of the month, what are the consequences?"
"There is nothing like spending all your money needed for bills, then find out for the next two weeks you have to eat Cup o' Noodles and worry whether you can pay your electricity or your landlord on time," Sahim said.
UH sophomores Kelsie Kim and Dara Fujio have a passion for shopping.
"We shop pretty much every other day," Fujio said, "spending around $300 each time, depending on what we find."
"Our parents pay for school and our cars, we just need to pay for our shopping," Kim added.
Graduate student Trevor Atkins plans to save his money this Christmas season and keep unnecessary expenses at a minimum.
"Most of my income goes to food and rent. ... I've never even been to Ala Moana," he said.
Credit cards are a popular method of payment for college students.
John Nabers, the educational outreach coordinator for Consumer Credit Counseling, said that the key to avoiding immense credit card debt is, "Don't spend what you don't make," adding that using credit cards is essentially borrowing money.
"All those pre-approved credit card offers that litter your mailbox generally have very high interest rates ... up to 30 percent," Sahim said.
Credit counseling is offered to students through companies such as Consumer Credit Counseling Services of Hawai‘i. The services they offer benefit both creditors and debtors through debt-management plans, in which creditors are contacted to arrange monthly payments that the client can afford, Nabers said.
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Viewing Comments 1 - 4 of 4
scott
posted 12/10/07 @ 11:11 AM HST
You're almost right about RothIRAs.
IRA: you don't pay taxes on it now but you will pay taxes on it when you take the mandatory disbursements.
RothIRA: pay taxes on the investment now but all will be tax free when you take disbursements. (Continued…)
nikki t
posted 12/10/07 @ 12:57 PM HST
the idea that students can spend that amount of money each year is astounding however, i think that the point of their input balanced the story. not all students are broke and i am annoyed that college students are automatically labeled as broke. (Continued…)
Ryan Ellis
posted 12/12/07 @ 8:14 AM HST
I agree with Scott about the Roth IRA's being taxed also...it is true. Now here is the scary part. The quote from the actual investment broker says
"In a regular IRA, you're subject to income tax, while in a Roth you're not, and you basically get all the money tax free. (Continued…)
chris
chris
posted 12/12/07 @ 11:43 PM HST
"In a regular IRA, you're subject to income tax, while in a Roth you're not, and you basically get all the money tax free."
Ryan: When do you "GET" all that money? When you withdraw from the account right?
Therefore, Sahim's statement is correct. (Continued…)
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