Unfortunately, though you are “officially” an adult who can do mature things like vote and drink without the fear of getting arrested for your fake ID, being a college student in your early 20s can still be challenging—especially when it comes to your finances.
One of the most difficult parts about both living on your own and learning how to become a fully-functioning member of society is learning how to manage your finances. From rent and living expenses, to tuition and textbooks, to your seemingly never ending bar tab, college can get quite expensive.
Most of us have to learn the hard way (read: spending too many nights checking your bank account while literally at the bar just to make sure you aren’t about to overdraw your account) that money doesn’t grow on trees, our parents’ credit cards actually do have a limit, and learning how to properly budget takes time.
But it isn’t all bad. In fact, being a college student does have some financial perks. The key is knowing which bills you have the power to reduce the costs of without having to alter your lifestyle.
Car insurance is one of the most expensive bills people in their 20s have, and it is usually more expensive for college students than any other type of driver.
Using Student Discounts for Insurance
A lot of people actually don’t know this, and just go with whatever insurance carrier their parents use, but most car companies offer discounts to students which can greatly reduce your rates (which is more than you can say for your god forsaken landlord).
These “good student discounts” offer financial rewards for doing well in school (getting a GPA of 3.0 or above). This surprises a lot of people, since some companies don’t even trust anyone below the age of 25 to rent a car.
Insurance companies tend to make policies more expensive for people under 25 because, statistically, young drivers more accidents. But, apparently, if you get good grades, you are more responsible in their eyes, and less of a risk, so they’re willing to offer you discounts for it.
Obviously, the exact amount of savings offered depends on the company, which is why it is a good idea to compare different insurance providers to see which makes the most sense for you.
Don’t expect them to just take your word for it, though. You might have your parents convinced that you are ace-ing all your classes, but if you want to enroll in a car insurance program that offers college students discounts, you will likely need to actually provide tangible evidence that you haven’t spent the entire semester drinking and avoiding the library.
Go the extra mile…
If you’re really serious about reducing the costs of your expenses, meaning you’re financially independent and actually have your sh*t together, there are additional ways you to reduce your car insurance bill. For example, taking a driver safety education course or installing anti-theft devices on your car.
If you don’t normally drive a lot on when you’re on campus, keep your car at home, or don’t ever need to drive at all when at school, it’s probably best to stay on your parent’s policy. (Unless they already told you that they are kicking you off and you’re on your own… which, in that case, you have no choice.)
Money is never fun to deal with or talk about, unless someone is just handing it to you, but it is a necessary evil for becoming an adult. The sooner you start budgeting, the better. Plus, reducing your car insurance rates can help you stay on track with all your monthly payments and expenses and, therefore, avoid ruining a good credit score—and, in case anyone hasn’t told you by now, this is something you’re really going to want once you’re out of college. Trust me.