Beginner's Guide to Saving Money

So you’ve decided to go to grad school. Good for you! But your carefree college days when you lived off of your parents' dollar are over, and you're probably up to your ears in student loans. What’s a cash-strapped, -debtsaddled grad student to do?

The way to go here is to save, save, save. Every penny you set aside now will help you later when you have that master’s degree in hand. You want to be able to pay off those loans and get on with your life once you’ve graduated.

And for many of us, grad school is our first foray into living independently, off-campus and with minimal parental support. It’s best to learn how to budget now so you don’t live beyond your means once you have an income to speak of.

Lucky you, the internet and the world around you offer a wealth of tips and resources for learning how to budget wisely. Here are some I’ve picked up and use to my advantage:

1. Don’t buy new unless you have to.

If you’re persistent, you may be able to find whatever you need second-hand for cheap or even for free. Browse your local Craigslist or Freecycle chapter, and be patient.

I swear by this one. Just last month my laser printer died on me, in the middle of a screenwriting workshop. But I wasn’t screwed, and I wasn’t suddenly out a lot of money. I picked up a used one in perfect condition-- nicer than my old one, in fact-- for $30 on Craigslist.

If you check often, you’ll be amazed at the bargains you can find. iPod touches and iPhones have been offered for less than a hundred dollars. Barely-used mattresses and bedframes for free or almost-free.

This works for clothes, too. I’ve never gotten clothes off of Craigslist or Freecycle, but I’m crazy about thrift stores. I got a pair of perfectly good, comfortable winter boots for $15. I picked up a gorgeous party dress for less than a dollar. I recommend Boston-area thrift stores like the Garment District, Frida Bee, Raspberry Beret, and Boomerangs. Or try your local Goodwill.

2. Don’t buy your textbooks from the school bookstore.

Textbooks are needlessly overpriced, and it’s really not hard to find cheap like-new copies online. Even factoring in the cost of shipping, this will save you a bundle.

Half.com, the Amazon marketplace, Abebooks.com, or Thriftbooks.com are some of my favorite places to purchase textbooks.

3. Track your spending.

This may seem like a huge pain. It is. Do it anyway.

I recommend using the free service at Mint.com. First, you set your budget: how much you think you spend, or should spend, per month on groceries, rent, utilities, fast food, entertainment, clothing, and so on.

Mint will track and sort every purchase you make, and send you a weekly email documenting how much you spend in each designated category. You can see exactly where your money goes, and you can plan and budget accordingly. Do you find yourself overspending on groceries week after week? How much is that daily Starbucks run costing you per month? Just a few months of using Mint can make you rethink your finances completely.

4. Shop around.

Like the song, right? Yes, you had better shop around. It does pay off. Many financial planning sites recommend waiting thirty days to make a purchase. This gives you time to decide if you really need it. But this also gives you time to compare prices. You don’t even have to go out of your way. You may notice the item you want for sale at different stores during those thirty days. Remember the price. Find out where it’s cheapest. Don't pay more than you have to.

Other Links and Resources:

The Cheapskate Guide - 50 Tips For Frugal Living

Wise Bread - A whole siteful of tips, tricks, strategies, and how-tos for saving money, from how to save money even at Whole Foods, ways to reuse aluminum foil, and how to eliminate waste in your cooking.

Saving Money Plan - has freebies, coupons and deals. Updated at least once a day.