College life is an exciting journey filled with new experiences, but it also comes with significant financial responsibilities. For many students, managing money effectively is a challenge, especially when faced with a myriad of expenses beyond tuition and textbooks. To navigate this complex landscape, students can benefit from expert advice on budgeting, saving, and making informed financial decisions.
Jesse Lineberry, an assistant professor of practice in Virginia Tech’s Pamplin College of Business and director of the university’s Financial Planning Program, offers valuable insights into personal finance and financial planning for college students. His expertise can help students build a realistic budget, prepare for unexpected costs, and develop healthy financial habits that will last a lifetime.
Understanding the Full Scope of College Expenses
One of the biggest challenges for students is recognizing all the expenses they will encounter during their college years. Beyond tuition and textbooks, students must consider a wide range of costs, including student fees, course materials, food, and housing. For those living off-campus, additional expenses such as groceries, coffee, eating out, travel, and day-to-day living costs can quickly add up.
Food, in particular, can be a significant expense. Studies from the College Board and SoFi indicate that college students spend around 30% of their income on food. For students with meal plans, Lineberry recommends keeping track of spending and making the most of the plan rather than paying for additional meals off-campus.
Creating a Simple and Effective Budget
Lineberry emphasizes that students don’t need a complicated system to get started with budgeting. The key is to begin with a simple approach and find what works best for each individual. Students can start by listing their regular income and expenses, separating fixed expenses from those that fluctuate.
Fixed expenses, such as rent and some utilities, may remain relatively consistent each month. On the other hand, expenses like food, entertainment, travel, and other discretionary spending can vary. Lineberry advises students to account for expenses that don’t happen every month, such as car insurance, cellphone bills, textbooks, car repairs, professional clothing, and travel opportunities. He recommends leaving some room in the budget for unexpected or miscellaneous expenses, typically around 3% to 5% of total expenses.
It’s important for students to understand that their first budget may not be perfect. Lineberry encourages young people to be patient and persistent, as it can take months to understand their actual spending patterns. Expenses can change throughout the school year, so flexibility and adaptability are key.
Distinguishing Needs from Wants
Lineberry advises students to distinguish between things they need to pay for and things they want to spend money on. A need is something that is required for survival, education, and investment in the future. Discretionary expenses, on the other hand, are additional things that students can enjoy if they fit into their budget.
A budget can actually make it easier for students to enjoy discretionary expenses, such as going out for coffee, eating pizza with friends, or attending a football game, because they already know whether those expenses fit into their plan. The bigger concern is when discretionary purchases become habits and begin to feel like necessities.
Lineberry is not against discretionary spending, as long as it is budgeted for. He encourages students to enjoy life while in college, as long as they are mindful of their financial responsibilities and plan accordingly.
Being Intentional with Student Loans
For students who need to borrow money for college, Lineberry advises being intentional about how much they borrow. He recommends borrowing only up to the cost of tuition and fees, and not for extracurricular activities, Greek life, spring break trips, or other non-essential expenses.
According to the Education Data Initiative, students who borrowed to earn a bachelor’s degree in 2026 took out an average of $35,639 in education loans, with 61% of recent bachelor’s degree graduates taking on student debt. Lineberry also advises students to consider expenses related to preparing for life after college, including professional clothing, transportation, and a security deposit for an apartment.
For seniors, planning for graduation expenses is especially important, as this period can bring a series of new financial responsibilities. Lineberry notes that students will need a significant amount of cash between the ages of 22 and 32 to facilitate major life events, such as weddings, marriages, and having children.
Building Savings Before Investing
Lineberry encourages young people to begin saving and investing early, but he emphasizes the importance of covering short-term financial needs first. Students should ensure that their budget covers their expenses and that they have projected their financial situation accordingly. If they have earned income, they can consider saving in a Roth IRA.
At the same time, Lineberry recommends maintaining cash savings for emergencies and upcoming expenses. His general rule is to have three to six months of essential expenses in cash. Students should calculate this amount using expenses they are required to pay, such as rent, a car payment, or other necessary bills, rather than discretionary spending like coffee or going out with friends.
