College Students, Take Note: Develop Good Spending Habits and Secure Your Future

With tuition fees, books, and housing costs, college is arguably the most financially taxing endeavor of a young adult’s life. Without thoughtful planning, students can easily be swimming in debt by the time they graduate. Credit cards can further complicate an already difficult financial situation for young people short on cash. 

College students today flex a spending power of 593 billion. If you’re a current or prospective student, you should understand the spending habits of a typical student. It’s also important to note that often the financial habits we establish as young people aren’t so easy to shake. A study by the University of Arizona found that how you manage your money in college determines when you see yourself as a true adult.

Because there are so many necessary costs when it comes to college, it’s crucial to be aware of your expenses, so you can take control of your spending and carefully plan for your time as a student and beyond. Without further ado, let’s dive right into the spending habits of college students.


College students and financing

The 19.7 million college students in the U.S. today finance themselves in various ways. Most college students bear their living expenses while paying a significant part of their college fees. Here’s a list of statistics from 2020 to shed some light on college students financing their education:


>> Try our student loan calculator


The spending habits of college students by category

Here’s a breakdown of what students are spending on.



Essential to any budget, there is quite a range of what people spend on food.

Around 34% of college students today say that it’s difficult for them to afford a sufficient amount of food every month. These students often tend to skip meals to reduce their expenses.

The average college meal plan costs around $375 every month. A study in 2018 showed that college students spent approximately $65 billion on food. Food expenses range from basic groceries to eating out and getting takeout.

In other cases, students try to be as economical as possible with food, especially when they’re struggling to manage other expenses. However, with increasing peer and social media pressure, the temptation to overspend is real—eating out or daily Starbucks runs can easily break a budget. The Insta-worthy pics of fancy food will burn a hole in your pocket (and fast). This trend has been steadily ticking upward for a while now, with these students spending around $4,000 a year on eating out. (Yikes.)


Books and other supplies

The good news is there are now some affordable alternatives—such as paperbacks and digital copies—when it comes to purchasing books and course materials.

Technology has consequently played quite a huge role in decreasing the spending habits of college students for traditional school supplies. There’s a surge in electronic study materials, gadgets, smartphones, and free learning resources on YouTube. Together, they have significantly reduced the expenses of supplies. 

According to the National Association of College Stores, students spent $413 on course materials in the academic year 2019-2020, a 41% decline since the amount spent in the academic year 2007-2008.

However, college students majoring in health and architecture have to spend more than their peers. While mathematics majors spent $357 in 2017-18, health majors spent $597 for their supplies during the same year.


Personal care and clothing

In 2019, college students spent a total of $9.5 billion on accessories related to personal care. The trend toward purchasing natural, chemical-free, and eco-friendly products has contributed to increased spending in this area.

And more often than not, personal care proves to be more expensive than other categories. You won’t gain a proper understanding of the spending habits of college students if you disregard personal expenses altogether. With advances in aspirations, lifestyle, and technology, this category has skyrocketed.

The average student enrolled in a four-year college program spends around $53,000 on personal care, which is approximately 12% more than what a student spends for academic purposes during the same period.

Here’s a more detailed breakdown:

  • College students today anticipated spending $148.37 on clothing and other accessories for the academic year 2020.
  • Furthermore, during the same school year, college students guesstimate spending $64.91 on collegiate branded clothing.
  • In 2019, 59% of college students who receive money from their parents stated that they would primarily splurge on clothing.



Housing is one of the primary expenses for college students. The average college student spends around $637 every month to cover housing costs. The amount students spend on rent also depends on a number of factors such as the location, accommodation type, and distance from their university. 



Transportation costs vary a lot based on accommodation. Many students go outside their home states to pursue a college degree. In this case, the recurring expense of traveling to and from their home state during college breaks can add quite a lot to their expenses. For instance, a student taking a train or bus to go home within a few hours will have significantly less travel expenses as opposed to a student taking a flight from Washington to Tennessee.

Costs will also vary depending on your type of transportation. If you own a car, you’ll have to consider added costs due to on-campus parking fees, gas, car insurance, and regular maintenance.

On the flip side, transportation costs will be much lower if you choose to walk to campus or opt for a bike or public transit. A lot of students prefer to stay off-campus in shared apartments to reduce higher dorm costs. However, make sure this doesn’t backfire with increased transportation expenses.

Though an exact amount can’t be calculated, studies show that the average college student spends around $2,800 on transportation during a 4-year college program. Due to the rise in an eco-friendly mindset, students can cut down on transportation expenses by going for healthier and greener options.

Additionally, students with dependents face higher costs. During a 9-month period, students with dependents spent $1,296 for transportation. Students living with their parents spend half the amount, while students living on/off-campus without dependants pay a third of it.



With the pressures that come with college life, healthy spending on entertainment becomes essential for a lot of students. And to be fair, they deserve it.

College students typically spend on different forms of entertainment, including but not limited to going to concerts and movies, renting on-demand movies, subscribing to streaming services such as Netflix and Amazon Prime, and purchasing video games.

Each year, college students spend around $2.4 billion in total on entertainment purposes. A survey showed that 59% of college students spend on live shows while 57% of them spend money on other forms of entertainment.



If you’re wondering why we have a separate category for alcohol, it’s because students spend a LOT on alcohol consumption.

Because college life is heavily associated with partying on weekends, binge drinking and alcohol consumption constitute a significant portion of student spending.

In total, college students in the USA spend approximately $5.5 billion on alcohol every year. Experts say this number is likely to rise in the coming years. If you’re looking to tighten up your budget, however, this is one area that can be limited (or eliminated entirely if you desire).


A typical budget of a college student

For college students, no budget is set in stone. Your annual expenses can vary greatly depending on where you go to college, where you live, and what lifestyle you adopt.

On average, students attending a public university for four years pay around $11,140 for room and board, whereas students attending a private university for four years pay around  $12,680 for the same.

70% of college students state that their main concern at college is the high cost of living, which varies greatly across different states. For instance, room and board at New York University (NYU) for 2020 cost $19,244, while room and board at the University of Nebraska (Omaha) cost $10,196 annually.

Keep in mind, out-of-state students have to pay double the tuition compared to in-state students: 


Annual budget for college students (in-state)

    • In-state tuition and fees: $10,560
    • Books and supplies: $1,240
    • Room and board: $11,620
    • Transportation: $1,230
    • Other expenses: $2,170

Total expenses: $26,820


Annual budget for college students (out-of-state)

        • Out-of-state tuition and fees: $27,020
        • Books and supplies: $1,240
        • Room and board: $11,620
        • Transportation: $1,230
        • Other expenses: $2,170

Total expenses: $43,280


Cost management tips for college students

As an adult, you should know and track your expenses. Extravagant spending will only drive you into debt and make you financially miserable. Here are some smart spending habits you can follow:


Calculate a budget and stick to it

In terms of money management, the transition from high school to college can be quite drastic. 

Everything about that life changes when you enter college, so you need to be conscious of your spending habits even before starting college. If your parents are funding your college partially or in full, sit down with them and create a budget that works for both of you. Write down all the sources of income, the allowance your parents will provide, and money from any part-time job you have, etc. Automating your finances can also be helpful when it comes to staying on top of bills.

Create a separate list of all your expenses (or use this college budget template), such as food, room and board, books and supplies, school projects, extracurricular activities, and transportation. This will allow you to estimate your annual expenses and stick to your budget.


Use student discounts

One of the perks of being a student is receiving student discounts almost everywhere. Opt for student discounts you find at your school, student bookstores, restaurants, local venues, vendors, and other services. Do not neglect these offers. The discount may be minimal, but the savings will add up.


Look for funding opportunities

Affording college in the U.S. is no easy feat. Check out national and international scholarship opportunities related to your major to see if you’re eligible for funds. If you have extra-curricular activities, these may also help you secure a scholarship.


Search for part-time jobs

If you want to contribute to your college expenses, look for a part-time job to help with costs. Work-study opportunities are available across almost all universities, which should keep you from borrowing loans unless absolutely necessary.


Final words

Attending college is a major financial milestone for both you and your family. You’re taking your first steps toward adulthood and gaining more independence—both personally and financially. Your awareness, planning, and good habits will help you not only limit debt but also set you up for success during college and as you enter adulthood.