Four ways for students to build net worth

Illustration by Kat Ingrim | The Collegian

As a college student, many of us have gotten used to cheap meals, meager bank accounts and making tough monetary decisions. With minimum wage jobs and staggering student debt weighing down on your shoulders, your college experience may be somewhat tainted by the stresses of a low budget.

It is possible, however, to escape the cycle of poverty that seems to overshadow many college students; you just have to be willing to work hard. By increasing your cash inflow and decreasing your cash outflow, you can start to improve your financial situation before you venture out into the real world.

Increase your income in a time-efficient manner
One concept that escapes people is that time is your biggest asset. Because you only have 24 hours every day, your first priority when making a financial plan is budgeting your time rather than your money.

As a full-time student, you may have a surplus of free time after you fulfill your academic responsibilities to hang out. Instead of sitting at home and watching Netflix, find a way to earn money. According to K-State’s Career and Employment Services website, the university has 2,200 part-time, on-campus jobs every year that students can apply for. With those numbers, there is bound to be a job available for you.

Also, be sure to consider your hourly rate. Although some jobs can give you a 40-hour week, it may only pay you minimum wage. In Kansas, this is $7.25 according to the U.S. Department of Labor. Conversely, other jobs may pay a much higher rate but only offer a few hours of work per week. Valuing your time more than money allows you to earn more dollars per hour so that you can use your remaining time finding another higher-paying part-time job, extra-curricular activity or other sources of income.

Decrease or minimize your debt
The Project on Student Debt, an extensive database dedicated to compiling statistics on costs of attending public universities in the U.S., listed the average student debt of 2012 K-State graduates at $25,147. Even though you technically don’t have to start paying your debt until after you graduate, it may be a good idea to start now.

By putting aside a certain amount of money every month, you will be able to make a down payment on your debts after you graduate. For example, even if you put aside $50 per month as a debt payment, you will have about $2,400 at the end of your college career to pay as a lump sum to your creditors. Even though it doesn’t seem like a large portion of your overall debt, it is a considerable amount of loans that you can get rid of immediately. Paying no interest on $2,400 is, after all, much better than paying the $2,400 plus interest.

Another option is completely avoiding debt in the first place. K-State awards $18.8 million in scholarships every year based on anything from academics, activities, service and involvement in the community, and financial need. One of the biggest misconceptions about scholarships is that they are only awarded to incoming freshman. If your GPA is higher than 3.0 after your freshman year, you will generally be eligible for a variety of scholarships offered by each of the different colleges.

Don’t abandon your search for free money after you get into school; in fact, you may have more luck getting scholarships while you’re actually here.

Formulate and follow a strict savings or investment plan
As a student, everyday costs and incidentals that can come up at any time can put a serious dent in your wallet. For this reason, it may be easy to slip into a habit of living paycheck to paycheck as a student. After all, taking it two weeks a time can be a lot less stress and lot less work.

Creating a savings or investment plan can really help you control your unnecessary expenditures, while also building an account that you can use as a rainy day fund. Or create an investment fund to help you grow your cash accumulation for life after higher education.

One way to stick to this is by treating your savings or investments as a mandatory bill from a third party – you. So while you may be paying money out of your pocket every month, that money is just going into another one of your pockets.

This takes planning, foresight and budgeting so in order to do this effectively, you will have to sacrifice some luxuries. The key is balancing your expenses and savings so that you can have long-term plan that gives you a head start on building your net worth.

Acquire specialized skills
As a student, you’ve taken the first step to creating value in your skill set by simply attending college. But that doesn’t mean you can stop now.

As globalization continues to affect the world and the international job market, we no longer compete with just our fellow K-Staters; we compete with the world. So what’s different between you and the other hundreds of thousands of students in college that share your major? This is the question that you need to ask yourself and find an answer for if you hope to one day find a fulfilling and well-paying career.

Many students today go through the motion of school. While the saying, “C’s get degrees” might be true, you are not adding value to what you bring to your future employer.

Finding skills that are specialized and unique can help you differentiate yourself from other graduates. Things like learning foreign languages, gaining unique technological skills or even building a specialized network in your future industry can give you a leg up. Sure, it may take some additional investment in the form of extra classes or purchasing books and online tutorials, but if you have a little disposable income left, it is important to try to use it in ways that will help you better your future.

Andy Rao is a senior in accounting. Please send comments to