Being a grad student is usually synonymous with being poor (or at least living close to paycheck to paycheck). This doesn’t have to be the case, and there are many ways to be careful with your finances.
It’s easy to put your finances aside, and figure you don’t have enough money to worry about them. But you need to know where your money is going, and what you can do, so that should a paycheck arrive late (or not at all), you’ll still be able to pay your rent and put food on the table. Or what happens if you get an opportunity to go to a conference or some other trip, but must pay for all costs up front (which is very common). Do you have enough money set aside to cover these costs? A fully reimbursable conference can end up costing you if you need to put it on a credit card that you can’t pay off in full.
In my experience, grad students seem to be of two types – those that manage to save (even if only a little) and manage their money really well and those that are always wondering where how they’re going to pay off the next bill coming due.
Some of this comes from the huge discrepancies with how much a student may or not make as a grad student. Some schools may not pay anything, and so it’ll be up to you to finance your entire degree. Others may guarantee a TA or RA to help out. But by the time you take tuition out of that, you might not have much left. Then, there are those who luck out with great scholarships that provide a decent (and possibly generous) living stipend.
I took a year off to work before starting grad school. This was for a few reasons: 1) being I wasn’t positive I wanted to go to grad school; 2) I already had a job lined up; 3) I could at least save some money while I decided what to do. This turned out to be a very good idea, as I made very little during my first year as a grad student, to the point that I would have needed a loan if I hadn’t had savings to fall back on.
There are lots of great personal finance blogs out there – some aimed more specifically for students. Most of them are designed for those with a steady job who are working to get themselves out of debt and onto a reasonable savings plan for retirement. Two that I have been sort of following are Get Rich Slowly and Gail Vaz-Oxlade. Both have dealt with student finances from time to time.
I think I’m going to do a series of posts on some budgeting “tips” that I find useful as a graduate student. I’m not a financial expert – my only qualifications are being able to keep a roof over my head, food on my table, and myself out debt. 🙂