Early homework can control college debt

COLUMBIA, SC (July 14, 2022) — With just weeks until the fall semester, students worried about the cost of higher education can take control by doing some early homework. The assignment: Thoughtful study of expenses based on objectives, needs, wants, an assessment of available resources, and from those a plan that simplifies on-campus decisions—a.k.a., a budget. Often, that means starting with the basics.

“One of the things we see a lot when a student is enrolling in college is that unless their high school had a class that taught budgeting—or any kind of finance, really—they don’t even know how to balance their debit account,” explains Matt Nichols, Columbia market executive for Founders Federal Credit Union, who with part-time student tellers anchored a partnership with the University of South Carolina that began seven years ago. He sees new students on their own for the first time make mistakes that earlier planning can curb.

“Freshmen who have never been on their own get money from mom and dad, grandparents, or financial aid, and time and again it’s gone,” Nichols reflects. “So just learning how to handle money and allocate amounts for necessities and so forth is the biggest thing.”

Put school—and its price—first.

Tuition and fees are clear, and college-provided aid has largely been determined. Students still have until June 30, 2023 to complete the Free Application for Federal Student Aid (FAFSA), and earlier is best. Should the first several weeks of class reveal greater need, North and South Carolina students can even apply on or after October 1 for state-level grants for the 2023-24 academic year.

Need is the operative word. Student loans are best used only for required tuition, fees, and housing. Beyond those, a handful of decisions can either grow college debt or keep it at bay.

Keep an eye on the big picture.

Following through on the up-front investment with a successful semester depends on first meeting basic human needs of food, shelter, clothing, health, activity, and connection. The weight of college expenses can grow depending on how those needs are met.

Nichols says connecting with freshmen during twenty or so summer orientations helps answer questions about accounts and budgeting, prompting valuable conversations with parents.

“When they’re traveling back, mom and dad can say, ‘Alright, you heard what the people at the credit union said. Let’s focus on this over the next few weeks before you get to school.’”

One approach is to review priorities.

Curricula and materials are a given, but their prices are not. Estimate books and supplies from college guidance on annual costs, and ask for specifics from instructors and academic departments. Reduce cost further with used or borrowed books—any notes and highlights are a bonus—and sell them back to a bookstore or another student when the semester ends.

Feeding the body and mind is straightforward with meal plans, while campus cards or cash are more flexible. Balance convenience, choice, and cost, mindful of usage limitations and individual habits. Even a reasonable plan for “three squares” may be too much if the first meal is often lunch. Since local merchants may accept campus cards, beware the cost differences and temptation to overspend—and have a conversation about boundaries.

Rest and personal space are no-brainers when freshmen are required to live on campus, which can simplify transportation and other expenses. Where college properties, privatized residences, and off-campus abound and tout upgraded amenities, list their features and prices, including utilities, proximity to campus, transit time and cost, and how each option impacts food choices and costs.

Create a positive environment.

Other factors in student well-being vary widely from one to the next, and personal preference can quickly escalate costs.

Dressing for the occasion at minimum means comfort as temperatures fall and rise again. Otherwise, it is a matter of style, brand, and quantity. Sort current pieces to define a campus wardrobe and reveal specific needs before going shopping. Consider alternative sources, and be judicious about how much is enough. A student entertained by second-hand store finds can drain an account faster than one who is confident in the newer buys they already have.

Self-discovery and connection are foundational in college. Thoughtful investment in extracurricular activities, exercise, and shared interests pays off in wellness and self-esteem. Compare on-campus fitness facilities and gym memberships, especially if housing options dictate either choice. Greek life, clubs, and interest groups can be vital, so give them and their costs due attention.

Transportation and employment can offer further freedom. Yet gas, maintenance, and insurance costs may be cause to reconsider taking a car to campus. Estimate those against part-time employment opportunities that can offset academic or discretionary expenses. A walk or public transit preserves that income, and a commute can be worthwhile if pay is greater or the experience holds longer-term value.

Plan and execute…and keep it simple.

A budget framework can start with at-home spending on food, clothing, well-being, and transportation matched to those on-campus categories. Noting non-negotiables, eliminating non-essentials, and ranking the remainder helps pare down choices to those that can fit. Clarity found ahead of the school year provides valuable guidance for the innumerable new experiences ahead. And by Nichols’ account, it does not have to be complicated.

“We try to break it down as simple as possible with necessities and wants. What’s a necessity? Tuition, room and board, books, food, gas to travel if you need to. The wants are things like clothing, concert tickets, and things they want to take part in while they’re in school,” Nichols explains. “It’s their money and we can’t control it, but we at least want to provide that education so they’re being smart with it.”

About Carolinas Credit Union League

The Carolinas Credit Union League is the not-for-profit association of credit unions throughout North and South Carolina. Established in 2014 with a commitment to the cooperative spirit, the Carolinas Credit Union League is credit unions’ primary advocate and much more, promoting their success through risk and compliance resources, professional development, product and service enhancements, and back-office support.


Brandon Pugh
VP, Public Relations & Communications
Carolinas Credit Union League
800.822.8859, ext. 410

Courtney Jackson
Director, Integrated Communications
800-822-8859, ext 076

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