Heading off to college is an exciting time—it’s the start of a whole new phase of life. Along with all the new experiences and opportunities come responsibilities, like doing your own laundry and managing your finances. Creating a budget is really important for the finances part. Effective budgeting can help you save money, avoid debt, and still have fun without constantly worrying about your bank account balance. Here are 8 steps to help you create a college student budget that’ll keep you in good shape financially.

1. Calculate your income

First things first: figure out your monthly income. That might include money from your parents (if they help you out with expenses), a part-time job or side hustle, scholarships, grants, or student loans.

2. Make a list of your expenses

Next, write down all of your expected expenses. Break them into two categories: fixed and variable. Fixed expenses are those you can’t avoid and don’t change month to month, like rent, utilities (if not included in your dorm fees), phone bills, and any recurring academic costs. Variable expenses are where you have more control, such as groceries, entertainment, eating out, and personal care items. Don’t forget to include occasional expenses like textbooks, school supplies, or travel costs home.

3. Prioritize your spending

After listing your expenses, prioritize them. Essentials like rent, utilities, and groceries are at the top since these are things you absolutely need. Next are important but more flexible categories like transportation and school supplies. Finally, discretionary expenses like eating out, subscriptions, and shopping should be considered last. This step is crucial because if you ever need to cut back, you know which areas you can adjust first.

4. Track your spending

Once you have your college budget set, the next challenge is sticking to it. Use a budgeting app, spreadsheet, or even a simple notebook to track every expense. Be honest and meticulous; small purchases can add up quickly and throw your entire budget off track. Regularly compare your spending against your budget to see if you are staying on course. This habit not only keeps your spending in check but also helps you see patterns and make adjustments as needed.

5. Plan for savings

It might seem tough on a tight budget, but try to set aside a small amount for savings each month. Even a little bit can grow over time and can be a lifesaver for unexpected expenses like a laptop repair or emergency travel. Consider opening a high-interest savings account where you can transfer a small amount each month and let it grow.

6. Adjust as needed

Your first budget might not be perfect, and that’s totally okay. Life’s unpredictable, and expenses can change. Maybe you’ll find that you’ve overestimated how much you need for food, or you didn’t account for seasonal expenses like winter clothes. Review and adjust your budget regularly to make sure it matches your actual spending needs. College is a time with lots of changes, and your budget should reflect that. The key is to stay flexible and adapt as your circumstances evolve.

7. Avoid debt as much as possible

Credit cards can be a tool for building credit, but they can also lead to debt if you don’t manage them carefully. If you decide to get a credit card, choose one with no annual fee and a low-interest rate. Always pay off the full balance each month to avoid interest charges. Avoid using your credit card for impulse buys or expenses that you haven’t planned for in your budget.

8. Take advantage of student discounts

One of the perks of being a student is access to a myriad of discounts. Many retailers, restaurants, and service providers offer significant discounts to students. Always carry your student ID and ask if a discount is available. Additionally, take advantage of campus resources—like free events, equipment rentals, and facilities—that can provide entertainment and services without straining your budget.