4 Ways to Effectively Manage Your Money

Have you ever been limited by your bank account? For example, some of your friends wanted to go to Rusty Taco for lunch but you were unable to because you didn’t have the money? I have been in that situation before. I think every college student has been in a situation like that before. It sucks.

You see, money is intended to be a tool but sometimes it controls us. Sometimes that looks like having too much money and going crazy (think Miley Cyrus or lottery winners that end up bankrupt). For most of us, however, our experience looks more like the first example. Our money (or lack thereof) controls us by limiting us and the things that we can do.

As someone who has a love affair with accounting and economics, I would like to offer four practical money management steps to you. My hope is that you would be able to manage your cash flow at least a little better after reading this article. Enjoying more Rusty Taco lunches with your friends isn’t bad either.



So, this first step seems basic but it is important that I start here. Generating an income is foundational to financial management because if you have no income then you have nothing to work with. Simple, right?

It is also important to generate your own income because that generation will lead to financial independence. It is also a means of stability and sustainability.

Some of the ways that you could generate an income are by participating in work study, selling some clothes/crafts on the NCU market, or by getting creative. Miriam Barnhart, the Enactus Project Manager, could fund part of her mission trip to Uganda by making and selling kombucha.

There are many opportunities to generate an income while at a university. The point is to begin generating something.



Once you begin generating an income, the next step is to keep track of the money that you’re making and what you’re spending your money on. I would say that a reasonable amount of time to track your income and expenses for is one month.

After one month of making and spending money, you should analyze your bank account activity. Generally, you should be able to go to your online bank account and see all the transactions posted to your bank account.

A bank account activity webpage should look something like this:


You can analyze your transaction history to see where your money is coming from and where it is going. Having this information is important for the third step.



Now that you know where your money is coming from and where it is going, it is time to organize your income and expenses into categories.

Generally, most college students only have one stream of income. Typically, that income stream is from their job. If you only have one stream of income, that is fine. However, if you have more than one stream of income, then it would be beneficial to differentiate between your streams.

There are many resources available for you to organize your income and expenses. One of my favorites is Mint and I also like a good ‘ole Excel template. If you’re not sure where to start, I would recommend Mint unless you are comfortable using Excel.

Once you have identified and organized your income streams, the next task is to organize your expenses into categories. At this point, you will probably have a good idea about the types of expense categories you need to account for.

As an example, I have listed off the expense categories that I account for:

·      Bills and Utilities

·      Food and Dining

·      Entertainment

·      Gifts and Donations

·      Shopping

The point of organizing your expenses is to create boundaries for your spending. If you don’t have boundaries on your spending, then you could end up spending more than you make and that would not be very good.


Once you have your income and expenses organized it is time for the fourth step.



We will bypass setting a budget for our income because we are always trying to increase our income. It isn’t bad to forecast an income of $1000 for October and end up generating $1500. It’s rational and doesn’t need to be said but I’ll say it since we are being foundational.

Your main expense categories (rent, food, auto, etc.) should not exceed 65% of your income (Mesquite Group).  If they do, then you might not have enough margin to save, donate, or chip away at debt.

The budget for each of your categories will vary based on your expenses and income, but I have included a document that should help you calculate the percentages for each category here that is the same document as the citation above.

You know how much you make and how much in expenses you should cover. So, you will need to use the information that you gathered in step two to set realistic budgets for each category. Once your budget for each expense category is set, then it is your responsibility to stick to it!

Once you have completed step four, you can repeat steps two through four to track your cash flow for each income/expense category and adjust when needed. The one point that I would hope to leave you with is to set a budget and stick to it! There is no worse feeling then overspending. You control your finances, they do not control you.

Those are my basic steps to financial management! Feel free to ask me or one of the Enactus members (aside from Shayna) if you need more financial advice. Oh, and be sure to include a budget for those Rusty Taco lunches with your friends.


Tyler Hanna, this year's NCU Enactus President, is a Junior at North Central University double majoring in Marketing and Entrepreneurship. Last summer Tyler taught accounting and economics overseas!