As I entered my freshman year of college a month ago, I thought that I would be one of the only people on a strict budget, with very little money. I also thought that people would spend freely while at college. Boy was I wrong!

Almost everyone at American University has limited amounts of money. While I have not met anybody who has a formal budget (thanks, dad), many of my friends here have either academic or athletic scholarships, or financial aid. According to the admissions statistics, almost 80% of the student body is getting some sort of financial help from the school. Whether in the form of a scholarship, a loan, or just free housing, many people are relying on assistance to attend this school. 

Financial aid, however, gets a little tricky. Many students have reduced tuition because their family demonstrates a financial need. This makes sense.  They are getting grants that do not have to be paid back. What is interesting though, is that most people have told me that it's not even close to enough financial aid, and that their families are still really struggling to pay the bill. One of my friends' father took out a second-mortgage on their house to help pay for her tuition. Another one of my friends went to community college for a year to save money on tuition and then applied to American University for the next three years. It really puts in perspective how expensive college education has become and the financial strain it puts on families.

I heard from a friend that the money being given to her by American University is only a loan and she has to pay the school back exactly what they are loaning her, starting six months after she graduates. The nice thing is that this is an interest-free loan. While it's great that she got a loan, it is a huge burden to have on her shoulders after graduation.

Another option for many students is called work-study. That's me! The students work at on-campus jobs and earn money to put towards tuition, books, or their own spending. I just got a job working with the alumni office making calls to former students asking them for money for the school.  Hey, $9 an hour.  So what if I'm a hired solicitor who calls and annoys people during dinnertime?  It's a job, and I know I will be good at it.  Anyway, so far I love this school and I don't mind helping to raise a few bucks!

Speaking of solicitations I have yet to receive a credit card offer!  None of my friends have credit cards and, in fact, people are staying away from them. I have a debit card and that's just fine by me.  Actually, I am one of the only people with a debit card. Some of my friends have credit cards where their parents pay the bill, but most people use cash. And honestly, cash is the most useful thing here at school because if you order in food, you have to pay with cash.

So, I am not alone. While most people do not make a monthly budget and keep track of their financial transactions, they know how much money they have and how they need to be conscious of how much they are spending. We tend to stick to the dining hall instead of going out to eat too often.  We are trying to be careful on the weekends when it is easy to spend.  Even joining a club can cost you in membership fees. I have learned to ask how much before making any commitments.  So far, I'm impressed that people are trying to live within their means. We will see if this continues as the year progresses.

Articles:

The Time has Come to Repay my Student Loans

 7 strategies to avoid the college debt trap

Finaid.org clock offers sobering message about rising student loan debt

Ariel Levin

Ariel Levin is a contributing writer for In College & Starting Out She will be attending American University in Washington DC in the fall of 2010.  She knows being in a city like Washington will pose challenges and financial temptations. She will share her experiences as a college freshman who is just starting out and learning to manage her money on her own. Compensated CareOne Blogger.

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