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Washington State University

Wellbeing Online

Habits for Responsible Spending

Piggy Bank

An unwise spending habit can create a lot of stress for you and negatively affect your wellbeing. This lifestyle may be full of instant gratification but it is detrimental to achieving longterm financial goals. Spending needs to be managed in a way that prioritizes your needs and saving for your future over your immediate wants. You must consciously substitute responsible spending for the out-of-control spending habits that may have gotten you into debt. While responsible spending may not prove to be immediately gratifying, it will allow you to reach your financial goals. 

Use these tips to help develop a responsible spending habit.

  • Have a plan: 

Develop a realistic budget for the short and long term so that you know what you need to spend on necessities (food, tuition, housing) and what you will have left over for the fun stuff. Look at the timing of when bills are due and make sure your cash flow meets those bills. Late fees will result in big trouble for your budget. 

  • Give Yourself an Allowance: 

It's easy to spend a lot of money on the extras- lattes, convenience foods, entertainment. Make sure you give yourself an allowance for these non-essentials and stick to your limit.

  • Avoid Using Credit Cards: 

Credit cards are only benefical if you are paying off the monthly balance, otherwise high interest rates will make for quick debt if your let your balance roll over to the next month. Keep credit spending to a minimum to avoid these charges. 

  • Keep track of your spending: 

Track every dollar you spend in one month. Did you really need everything you bought? Remind yourself that you can't have everything while you are in school. You don't want to live so large in college that you risk your financial future.

  • Borrow sensibly: 

Remember, any money you borrow now must be repaid later. Make sure you understand what the terms of your loans are and don't take out more than your need. 

  • Protect your identity and monitor your credit: 

Ensure that your personal information is safe from identity theft. Always check your credit report annually to be sure that your information is correct and has not been compromised. You can order a free copy of your credit report once a year from each of the three national credit bureaus.