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Understanding fixed and variable college expenses

College is expensive. We all know that. But by understanding the difference between fixed and variable expenses, you can more easily find ways to put your expenses on a diet and stay true to your fixed college budget. We’ve compiled a quick look at the differences between fixed and variable expenses and how to put that knowledge to good use. 

Fixed expenses don’t change (very often)
A fixed expense is basically a ‘need’ item. The biggest fixed expenses you’ll have in college are tuition, room and board, as well as your car payment (if you have one), car insurance premiums (if you have a car), as well as your wireless plan and internet service. Yes, those bills can fluctuate slightly. But they often remain consistent until rates increase. 

Saving money on fixed expenses 
It is possible to trim your fixed expenses. Items such as wireless phones, car insurance, and internet access can be negotiated in most cases. Ask about a less robust plan for your smartphone. Call your insurance agent and ask about discounts. And choosing slower connection speeds can save you a lot on your internet service bill. 

You can control variable expenses
Variable expenses are more-than-often ‘want’ items. In college, your variable expenses include entertainment, clothing, gas, coffee, and eating out. The more you spend, the more you’ll chip away at your monthly budget. When you spend carefully, you’ll put more money back into your month. 

If you live off campus, then some of your other variable expenses will include electricity, water, heat, sewer, and garbage.  It’s a lot harder to control how much you spend on utilities, but you can limit your bills by turning off lights in rooms you’re not using, keeping the heat or air conditioning at a moderate temperature, and using less water whenever possible. 

Keep an eye on your variable expenses
Your fixed expenses should be deducted first from your budget. If you have money left over at the end of the month, then you did well in keeping your variable expenses in check. If you’re out of money, then you need to look closely at where you spent your money and how you can do better. 

Online and Mobile Baking are great tools for keeping track of your money. In fact, you can review every purchase instantly when you use a First Tech debit card for all of your purchases. 
First Tech tip: Add another savings account to your membership and put your full monthly budget into that account. Move money over to checking only when you intend to spend it or when a bill has been set to be paid. This will keep you aware of every expense.
Don’t turn a credit card into a fixed expense
Whether you opened a credit card in high school or just received your first one in college, it’s important to only use it for emergencies while you’re in school. When you use a credit card for a variable expense, you might end up creating a fixed monthly expense that can be harder to manage. 

Get smart money advice  
Your First Tech membership gives you access to a host of pros who are here to help you with your finances. Call 855.855.8805. Plus, check out our personal finance modules with topics on credit cards, higher education, and other topics to help you survive the financial side of life.