Between tuition, housing and food — saving money in college can seem impossible. Add in the more fun expenses, like social activities and spring break, and the total gets even higher.

In fact, the average cost of college in the United States is $36,436 per year, according to research from the Education Data Initiative.

All of the expenses can feel overwhelming, to the point where the idea of saving money might not even seem realistic. You probably won’t come out of college with a huge savings account, but you can work on building strong saving habits so that when you do have an income or earn more money, you’ll know how to manage it well.

After all, the most important thing to remember when it comes to saving is that every little bit helps and the sooner you start, the better.

Here are seven tips for helping you become a money-savvy college student.

1. Reduce living expenses

Room and board makes up a significant portion of total college costs. The average cost of room and board at an in-state, four-year public school was $12,310 for the 2022-23 school year, according to the College Board. You’ll likely pay several thousand more at a private institution. Since this covers two semesters’ (or about nine months’) worth of residence, it comes out to $1,368 per month.

You may be able to save money by living in an apartment instead of a dorm. The national average monthly rent for a two-bedroom apartment is currently $1,346, according to Apartment List, which also states the monthly average cost of electricity and internet is $160. If you share these expenses with a roommate, and you spend $200 a month on groceries, you’ll pay $953 a month. (Keep in mind rent prices can vary widely across the country.)

If you’re open to living at home with your family and attending a nearby college, this may save you a bundle on housing and possibly groceries. If you’re taking out loans for college, shaving room and board off your total bill could mean paying off your college debt years sooner.

2. Utilize cash back cards

Just 24 percent of college students with credit cards feel they have excellent money skills, according to Sallie Mae, which reported college students had an average credit card balance of $1,423 in 2019, up from $1,076 in 2016.

But responsible use of a credit card can help you build credit and possibly earn some rewards. Cash back or other rewards programs are often available with debit cards, rewards checking accounts or credit cards.

The Venmo card, for example, is a debit card that uses money from your Venmo balance or bank account. Venmo is a peer-to-peer payment service that allows you to send and receive money from friends and family — making it a popular option among college students.

At first glance, the Venmo card may just look like a convenient choice, but it also offers some nice cash-back options. The retailers tend to change every so often, and cash back amounts can vary by offer. Past offers have included 5 percent cash back for purchases at Wendy’s, Target and Sephora.

Rewards checking accounts operate similarly, though you’ll typically earn a low flat-rate on all spending. For instance, Quontic Bank offers a rewards checking account that earns 1.5 percent cash back on eligible purchases.

Finally, it’s also worth considering a cash back credit card. These tend to offer the most lucrative rewards, but they can also be dangerous if not managed responsibly. They’re not a good fit for students who cannot commit to paying the full balance every month or who may lack the credit history to get approved.

3. Leverage student discounts

Student shopping discounts

It pays to be a savvy shopper — especially when you’re a college student on a lean budget. Retailers commonly offer discounts to students, such as:

  • Spotify Premium Student: This account provides a discounted subscription to Spotify Music, along with access to Hulu and Showtime. After a one-month free trial, the cost is $4.99 a month, and you can cancel anytime.
  • Amazon Prime Student: You’ll get all Prime benefits, such as textbook rental, Prime Video and free shipping. After a free six-month trial, you’ll pay $7.49 a month.
  • Discounted Apple products: Apple offers discounts to students and educators on select computers and iPads.

You can also receive student discounts on various products and memberships through websites like Unidays. It currently features discounts and deals from merchants such as Apple, American Eagle, Dell, GoPro, Puma, Samsung, Uber Eats and Under Armour.

Banking perks for students

Some banks offer special benefits to students in the form of account-opening bonuses, ATM reimbursements, overdraft forgiveness or free checks. For instance, Chase Bank currently offers a $100 bonus to new customers who open a College Checking account and complete qualifying transactions.

PNC Bank offers a Virtual Wallet Student account that allows for one complimentary overdraft or returned item fee refund for one’s first overdraft occurrence on the Spend Account. This has a value of $36.

Other banks that offer student checking accounts with special perks include Navy Federal Credit Union and Santander Bank.

4. Keep track of your spending

  • Among millennial college students who received spending money from their parents, 45 percent report spending it “very responsibly” but just 18 percent believed their parents would agree. (OppU)
  • Of this group who received spending money from their parents, 76 percent said they mainly spend it eating out. (OppU)
  • More than half (53 percent) of millennial college students who receive money from their parents say they spend it on drinks and snacks. (OppU)

Inflation is slowing, yet prices remain uncomfortably high on essentials like groceries, gas, rent, utilities, prescription drugs and personal care products. Identifying ways to save money can help take some of the bite out of inflation.

It’s hard to find areas where you can save if you don’t have a budget in place. You can make budgeting quicker and easier with a money-saving app that analyzes your spending and identifies areas where you can save money. Some apps can even automatically transfer funds to your savings account.

Popular apps to help you save money include Digit, Mint, PocketGuard, Qapital and You Need a Budget.

A key to being able to save money is also knowing where you are wasting money. The goal should be to save as much of the money as possible already earmarked for college. I recommend that you start by using an online tool to help you track your spending.

— Robert FarringtonFounder and CEO of The College Investor

Kora is a personal finance app designed specifically for students, and its money tools have been created with input from college students. Kora provides insights into your spending and gives you personalized finance tips. It can even show you a comparison of how your money skills compare to those of other students — on an anonymous basis.

5. Save on school supplies and textbooks

Full-time, in-state undergraduates at four-year public universities pay an average of $1,226 for books and supplies in a school year, according to the Education Data Initiative. It also reports that one quarter (25 percent) of these students say they worked extra hours to pay for their books and materials while 11 percent skipped meals in order to afford books and course materials.

College books can easily set you back a pretty penny per semester. Your course list may include required materials, but it can pay to hold off until the professor confirms you need these on the first day of class.

If you do want to buy your books before classes start, confirm with the bookstore that it will accept returned books that haven’t been removed from their packaging.

Some ways you may be able to save money on books include:

  • Buy used textbooks.
  • Rent textbooks.
  • Check if there’s an online version that’s cheaper.
  • Split the cost with a friend who’s taking the same class.
  • See if the library has any of the required reading materials.
  • Some grants and scholarships can be applied to textbooks. Using these funds to cover books could free up some money to go into a savings account for future expenses.

6. Get a side hustle

Many students earn money through a part-time job that they can attend after school or on weekends. However, participating in sports or other extracurricular activities may limit how much time you can devote to work. If this is the case, a flexible side hustle may be your best bet.

Having a side hustle helps with gaining extra income, and it can also help build your emergency savings fund or keep you from dipping into your savings when you need extra cash. Bankrate’s side hustle survey found:

  • More than half (53 percent) of Gen Zers and 50 percent of millennials do extra work on the side to earn more income.
  • More than a third (36 percent) of Gen Z members use their extra earned income for savings, while 28 percent use it for regular living expenses.
  • More than a quarter (27 percent) of Gen Zers believe that they will always need their side hustle to help make ends meet.

Some ideas for side hustles include:

  • Working as a driver for DoorDash or Uber Eats
  • Selling things in an online marketplace like eBay, Etsy or Amazon
  • Dog walking
  • Tutoring
  • Grading papers for professors
  • Paid internships

7. Open a high-yield savings account

Even if you’re only putting a few dollars into savings each month, there’s still an opportunity to grow what you have by putting your money into a high-yield savings account. The best banks for college students are often those that pay high yields, don’t charge monthly fees, and don’t require a set minimum balance.

Online banks commonly offer a combination of competitive rates and no maintenance fees. Half (50 percent) of Gen Zers reported having an online bank savings or money market account, Bankrate found. Of those who don’t have an online bank account, 28 percent said it was because they’re comfortable with their current bank and another 28 percent said they prefer having access to a local branch.

If you don’t already have a savings account, they’re often easy to open and many don’t require much — if any — of an opening deposit. Finding an account that pays you the highest annual percentage yield (APY) will help grow your balance as quickly as possible.

While savings accounts at brick-and-mortar banks commonly earn an APY of 0.01 percent, much higher rates — of up to 5 percent — can currently be found at some online banks. To see how much you could earn just by saving, give Bankrate’s savings calculator a try.

College students building wealth and savings

  • More than one-third (35 percent) of Generation Z members (ages 18-26) have money in an investment account. However, due to rising interest rates and economic factors, 38 percent of them said they’ve either moved money out of their account or withheld any additional contributions. (Bankrate May 2023 investment survey)
  • More than half (52 percent) of Gen Z members say money has the biggest negative impact on their mental health. Of this group of Gen Zers, 54 percent say paying for everyday expenses is their biggest money concern, at least occasionally. (Bankrate May 2023 financial wellness survey)
  • When asked about taking vacations, 65 percent of millennials who said they weren’t likely to afford a vacation this year said it was due to inflation and rising prices, while 51 percent and 38 percent attributed it to insufficient income and focusing on other financial priorities, respectively. (Bankrate April 2023 summer vacation survey)
  • The average student loan debt is $37,338 per borrower, which leaves little room for savings during college years. (Education Data Initiative)
  • Among recent high school graduates enrolled in college, nearly one-third (31 percent) were either employed or looking for work. (Bureau of Labor Statistics 2023 College Enrollment and Work Activity of Recent High School and College Graduates Summary)

Bottom line

Saving while in school may seem out of reach, but if you follow these tips, you should be able to save a little extra cash — even if it’s just a few dollars off online shopping.

Increasing financial literacy through responsible spending and credit card use, as well as consistently saving money, can help young adults start building wealth early.

Just remember that no matter how little, every bit helps. The important part is that you are working on developing smart saving habits now, which is the base of a strong financial future, and that’s something worth celebrating.