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5 tips for students maintaining finances during a recession

Rounding it up

  • Get a budget; there’s nothing more useful or important than creating and living within a budget.

  • It is essential to avoid common pitfalls like using credit cards and succumbing to peer pressure.

  • Ensuring you have breathing room in your budget, watching where each dollar goes, and getting rid of debt can make you financially solvent for the long haul.

It’s back-to-school time and whether you’re a parent getting your grade schoolers ready to head back to the classroom or a rising university freshman heading to campus for the first time, you’ve got to be ready.

This is especially true if you are in that latter group and perhaps heading away from home for the first time in your life. It’s also true if you’re an established university student and returning to campus. Whatever group you fall in, you’re going to have to spend some money to get ready for the year and then continue spending as you make your way through life.

But what about this recession? Things are more expensive than ever before. Food and supplies are pricey–how can you keep your budget under control? What do you need to know to manage your finances so that you make it through this year in the black? In this article, we’ll take a look at some of the common pitfalls students make with their finances, and the top five ways you can maintain your finances during a recession.

Forget the recession for a minute

Yes, it’s something we’ll get to, but first let’s talk about how in order to maintain your finances during the recession, you need to be able to maintain your finances well in the first place! There is, however, one tip that will serve you well wherever you go: budgeting.

If we’ve said it once, we’ve said it a million times! The most important tool in your quiver is a functioning budget. Take a look at the money you have coming in against the expenses you’ve got going out. This includes any cash you get at a job or via work-study.

It also includes any cash you may be getting from parents or family members or perhaps proceeds from a student loan that you may have taken out for living expenses. Expenses should include both fixed costs, like rent or utilities you may need to pay, and flexible costs, like groceries. Since this is university, be sure you put some funds to the side to have fun as well, but understand that if you run into financial straits, costs for having fun will be at the top of the list of expenses to cut.

Once you grasp the above, it’s time to  track every charge you make. How you create your budget is up to you; there are tons of websites and apps, but a simple spreadsheet will suffice. Make sure you note each charge and dock it against the money you’ve budgeted for that item. Stay in the black and you’re all set.

Common pitfalls

University students are more often than not new to the financial realm. Many have left home for the first time and are actively forging their own path without their parents. If you’re a returning student you’re putting the finishing touches on that path. Avoiding these common pitfalls can help you make it to graduation day a solvent student.

Peer pressure

It can be extremely hard to tell a group of friends “I can’t go out” because you’ve exceeded your ‘going out’ budget for the month. But that is, quite honestly, the smart thing to do.

Yes, there is the notion that being in university means you should be living as much as possible, but it’s going to get very difficult to live any life at all if that’s your mentality in everything you do.

Don’t give in to peer pressure to make purchases or go out frequently if you can’t actually afford to do so. A good way around this is to suggest something else that you can do for cheaper. This may not always work but every now and again, you might find a friend in a similar financial position.

The credit trap

Between advertising and the spending opportunities being marketed left and right, you’re probably convinced that getting a student credit card is the way to go. Owning and using a credit card responsibly can help you a ton in the long run by building up your credit history. The key point here, however, is responsibly. If you’re using your credit card to fund trips to local establishments and then have trouble paying the tab at the end of the month, you likely aren’t using that card responsibly. No amount of reward points is worth several thousand dollars in credit card debt.

Wants and needs

University students often have trouble differentiating between wants and needs. Do you need to pay rent? Yes. Do you need to go on that trip to Tremblant? No, you probably only want to do that. One practice that can help you clarify the difference between wants and needs is to set realistic financial goals for yourself. If you truly do want to go on that trip to Tremblant, then by all means do so. Save for a trip throughout the year so when someone suggests it, you have cash ready.


University students should absolutely explore investments for retirement and general savings. However, be careful investing when you don’t fully understand what you’re doing. There will be plenty of opportunities to invest in businesses, stocks, or friends’ ventures throughout your life– consider carefully if you’re willing to lose the money you’re putting in.


It’s simply not something university students often consider. You need to have a solid, robust savings account with a plan for keeping it topped up so you can continue to move toward your financial goals. Yes, even if that goal is a summer vacation. A portion of the money you bring in should always end up in a savings account. Pay yourself before you pay others and for non-essential things.

5 Tips for Maintaining Finances During a Recession

Let’s get out of the negative and into the positive. Here are a few things you can do to weather the recession and maintain your finances.

Breathing room

Recessions are all about uncertainty, and this is especially true for the industries most occupied by university students. Students often take jobs in stores or restaurants and are paid hourly. These positions are often some of the first to go if business starts taking a dive.

Make sure you have your ducks in a row and have an emergency fund squirreled away in case the worst should happen. Additionally, consider giving your budget a bit of breathing room, too. In a recession, things simply tend to cost more. You may have to contribute more to your grocery budget in a given month and skip out on a night at the bar with friends.

Pay off any debt

This can be one of the most important things you can do to maintain your finances during a recession. As interest rates rise, debt becomes more expensive. Additionally, any outstanding debt you have is something that you have to pay back. If you suddenly lose your income, you’ll have an awfully hard time paying it. Make a concerted plan to pay back the debt you have, especially if it's something with variable interest, like credit card debt.

Cut costs & watch the little things

This goes without saying but if you run into financial trouble, it might be time to start cutting out some of those extraneous charges. Paying for all the streaming services? Maybe find one or two that you no longer need. Skip the coffee at the fancy coffee place in favor of something you make at home. Cutting costs in little ways can really add up, and spending in little ways can, too. If you don’t watch out for the little things you’re spending on, you’ll end up spending quite a bit more than you planned.

Seek opportunity

Recessions often provide opportunities in places you wouldn’t normally see. There may be new jobs or ways to make money that you did not consider pre-recession. If you were let go from a job, ask around at your school to see if a position is available. If you’re studying a specific trade in school, consider visiting businesses that deal in the trade to gain experience.

Invest in you

Most of all, you’re at school to learn. Investing in yourself is the best way that you can do that and more than any other thing, will be the best bang for your buck. If investing in yourself and really digging your teeth into school means taking fewer hours at your job, you may have to do that. Investing in you also means networking.

After all, you won’t be in university forever and when you graduate you will have to get a job. Do you know the players in your industry? Are there a few at your school or in a city or town nearby? Ask them for coffee. Join professional associations and learn more about the career path you’re considering. The more people you know, the more levers you’ll have to pull when the tassel is shifted to the other side of the cap.


School is hard enough and it’s not fair that the economic gods have seen fit to add recession on top of that. But they have and we’re here. Remember, budgeting and living within your means are the two of the most important aspects of successfully maintaining your finances. Doing these two things alone can put you steps ahead of the game.

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Dan Bucherer

Dan is a runner and writer living in the Washington, D.C. area, where he currently works for a financial services trade association as the Communications Director.