Financial Wellness for College Students

Financial Wellness

The definition of financial wellness varies depending on the individual’s comfort levels and goals. At its core, financial wellness indicates the ability to progress towards long-term financial goals while meeting current needs. Each person’s college experience differs, but most learners must secure funds for living expenses, tuition, supplies, and emergencies. Most students can achieve financial wellness with hard work and a solid strategy.

This guide explores short-term needs, long-term goals, and methods to ease financial stress. The following sections also examine ways to minimize and repay student loans.

Finding Balance Between Money & Health


  • What is financial wellness?

    Financial wellness is the ability to pay for current needs while saving for long-term goals, such as retirement, a house, and college.


  • How much does college cost?

    According to the National Center for Education Statistics, room, board, and tuition for the 2017-18 academic year cost an average of $17,797 at public institutions. Private nonprofit and for-profit schools cost an average of $46,014 and $26,261, respectively. Learn more about the cost of college using this calculator.


  • How does financial wellness affect health?

    A 2019 study by Fidelity Investments found that financially stressed employees were less likely to get enough sleep, receive flu shots, exercise, and maintain a healthy weight.


  • Is tuition cheaper for online programs?

    Many colleges offer discounted online tuition rates. Additionally, schools often waive student activity and campus maintenance fees for online learners.


Short-Term Concerns and Solutions



One of the essential pillars of financial wellness involves meeting short-term needs. Creating and following a budget can help students live within their means. Typical line items for a college budget include basic needs, school costs, and family needs. This section explores budgeting strategies, along with scholarships, loans, and public assistance options that can help learners achieve financial wellness.


  • Budgeting

    A budget includes an income estimate and allocates for basic needs, savings, and entertainment. Basic needs typically include food, housing, healthcare, and emergencies. A school budget should also include tuition, textbooks, and supplies. Students who support a child or family member may need to consider the cost of childcare and basic needs for dependents.

    Fortunately, free budgeting apps such as Mint and EveryDollar make tracking expenses more manageable, even for users with inconsistent monthly earnings. Individuals can also set up autopay for bills to help maintain a good credit score and strong financial health.


  • Scholarship and Grants

    College students should apply for as many scholarships and grants as possible to reduce out-of-pocket short-term expenses and long-term debt. In most cases, these awards do not require repayment.

    Many colleges, universities, nonprofits, and corporations offer scholarships. Applications usually require an essay, recommendation letters, and official transcripts. Organizations typically award grants to students who demonstrate financial need or plan to conduct specific research.

    Learners can complete the FAFSA form to apply for Federal Pell Grants. Applicants should pay close attention to eligibility requirements for each grant and scholarship. Students should prioritize the awards for which they are most qualified.


  • Student Loans

    After exhausting out-of-pocket funds, scholarships, and grants, learners can apply for student loans to pay for living and education expenses. While loans assist students in the short-term, they can negatively impact an individual’s long-term financial wellness. Loans require repayment and accumulate interest, so students should minimize the amount they borrow.

    The government uses information submitted on the FAFSA to determine each student’s eligibility for federal subsidized and unsubsidized loans. Subsidized loans do not begin accruing interest until after graduation. Both types of loans offer a six-month grace period after graduation before borrowers must begin making payments. Recipients can use loans to cover the cost of tuition, supplies, and living expenses.


  • Community Support and Public Assistance

    Before applying for extra federal or student loans to pay for living expenses, students can consider seeking help from their community. According to Feeding America, 110 food banks nationwide distribute food directly to college students. Additionally, Feeding America reports that 39 regional food banks help learners apply for SNAP, formerly known as food stamps. However, not every college student qualifies for SNAP benefits. Learners can locate their local Feeding America food bank online.


Long-Term Concerns and Solutions



The ability to save for long-term goals marks another pillar of financial wellness. This section examines methods for paying off student loans, building credit, and saving for primary financial goals.


  • Paying Off Student Loans

    Unsubsidized loans begin collecting interest immediately, while subsidized loans begin accruing interest after the recipient graduates. To minimize interest and future monthly payments, learners can consider making loan payments prior to graduation.

    When graduates begin making payments, borrowers can choose to pay more than the minimum payment due. They can also make multiple payments per month. Some loan providers offer a small discount to individuals who enroll in autopay, and the federal government offers student loan forgiveness in some circumstances. Individuals may also receive a lower interest rate by consolidating loans through a private company or bank.


  • Building Credit

    Credit card companies, loan providers, utility companies, and landlords all make decisions based on applicant credit scores. An individual’s credit score impacts their interest rates, credit limits, and loan amounts. While most states set regulations that prevent utility companies and landlords from refusing service to applicants with low credit scores, these applicants may need to provide a larger deposit or acquire help from a cosigner.

    Individuals can improve their credit score by minimizing debt, responsibly using credit cards, and making on-time payments. Learn more about building a credit score in college.


  • Saving for Major Financial Goals

    When creating a budget, students should include a plan to save for the future. Common long-term goals include making a down payment on a home, saving for retirement, funding children’s college, and traveling. Individuals can open multiple savings accounts to keep track of their progress toward various goals. Additionally, savers can work with a financial advisor to set up a Roth IRA.

    Keep in mind that saving for long-term goals while in college poses a challenge for many learners. Saving often becomes more manageable after obtaining full-time employment.


College Students and Financial Stress

Financial stress often affects young adults during their studies. According to a survey by FundingU, 54.65% of college students in 2017-2018 reported they did not have enough money to pay for college. Of these respondents, 52.86% indicated that money issues delayed their graduation date.

Additionally, stress surrounding student finances can affect mental health. Students who must consider quitting academic programs before graduating due to financial concerns report a decline in psychological health, according to a 2013 study.

Learners struggling with mental health should contact their school. Many colleges and universities provide free counseling services. A college education is an investment and often leads to higher-paying positions. By prioritizing financial wellness early in life, individuals can begin working toward their future goals.

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