Graduation season is an exciting time. Whether you’re packing up for your first semester at college or planning your next steps after high school, one thing’s for sure: you’re about to get a crash course in financial independence.

College brings new freedom, but it also comes with new responsibilities. Between late-night study sessions and campus life, it’s easy to overlook your budget — until your bank account is in the red or you’ve racked up more debt than you expected.

At American State Bank, we’re all about helping you start strong. As your local Iowa bank, we’ve seen the money mistakes students often make — and how they can avoid them. So, let’s break it down.

1. Money Trap: Signing Up for Every Credit Card Offer

It happens fast. You move onto campus, start getting emails or mail about “student-friendly” credit cards, and before you know it, you’ve signed up for a few. It might seem harmless — especially if the credit limit is low — but credit card debt builds up fast.

Why it’s a trap:

  • Interest rates are usually sky-high (often 20% or more)
  • Minimum payments barely chip away at the balance
  • One missed payment can ding your credit score

Smart money move:

  • Only open one credit card, and use it for small, manageable purchases (like gas or groceries)
  • Pay it off in full every month
  • Monitor your spending with ASB’s mobile banking tools, so you’re always in control

2. Money Trap: Overspending on Food and Coffee

Look, we all love a good coffee shop latte. But those $5 drinks add up. So do late-night pizza runs and convenience store snacks between classes. You might not notice the spending until you check your account and wonder where all your money went.

Why it’s a trap:

  • Eating out is convenient, but it’s one of the biggest budget busters for students
  • Grabbing a coffee or smoothie every day can cost over $100 a month

Smart money move:

  • Set a monthly limit for food and fun purchases
  • Meal prep a few times a week (even easy recipes can save you big)
  • Learn to love your dining hall — it’s already paid for!

3. Money Trap: Forgetting About Subscriptions

Free trials turn into monthly charges. It's easy to forget about the streaming services, music apps, gym memberships, or that subscription box you signed up for last semester.

Why it’s a trap:

  • Small charges sneak up on you — $10 here, $15 there — until you’re paying $100/month on things you forgot you even signed up for

Smart money move:

  • Go through your bank statement once a month
  • Cancel any subscriptions you’re not actively using
  • Use ASB’s online banking tools to set alerts or track spending by category

4. Money Trap: Skipping the Budget Altogether

If you don’t know where your money is going, you’ll lose track of it fast. Too many students wait until they’re in overdraft to start budgeting.

Why it’s a trap:

  • You overspend without realizing it
  • You’re unprepared for surprise expenses (hello, car repair)
  • You feel anxious every time you swipe your card

Smart money move:

  • Start with a simple 50/30/20 rule:
    • 50% for needs (rent, groceries, books)
    • 30% for wants (fun, eating out, shopping)
    • 20% for savings or debt payments
  • Use ASB’s tools or a free budgeting app to help you track where your money goes

5. Money Trap: Ignoring Student Discounts and Campus Perks

You’re already paying tuition — don’t miss out on the perks! Lots of businesses offer student discounts, and your school might have resources that help you save, too.

Why it’s a trap:

  • You end up spending more than you need to on tech, fitness, events, and even transportation

Smart money move:

  • Always ask, “Do you offer a student discount?”
  • Use your campus gym, printing services, and counseling centers before paying for outside services
  • Look for Iowa-based businesses that support student deals. Local savings can go a long way!

6. Money Trap: Taking Out More Student Loans Than You Need

It’s tempting to borrow extra for living expenses or to “have a cushion,” but it can come back to haunt you after graduation.

Why it’s a trap:

  • Interest starts adding up right away (depending on your loan type)
  • It’s easy to borrow more than necessary — and harder to pay it back later
  • More loans = more years of repayment, with interest

Smart money move:

  • Only borrow what you truly need for tuition and essentials
  • Apply for scholarships or grants every year (yes, even after freshman year!)
  • Work part-time if you can — on-campus jobs are often flexible with school schedules

At American State Bank, we also offer savings accounts and budgeting tools to help students avoid taking out unnecessary loans by building healthy habits early.

7. Money Trap: Not Building Credit or Saving Early

Some students steer clear of credit cards altogether, which avoids debt, but also means they miss out on building a credit history. And if you’re not saving? You’re setting yourself up for stress later on.

Why it’s a trap:

  • You might struggle to qualify for apartments, loans, or even jobs later if you don’t build credit
  • Life happens — car trouble, emergencies, and unexpected costs pop up

Smart money move:

Bonus: Quick Tips for Financial Success in College

Here’s a quick list of habits that can help you stay on track:

  • Check your balance once a week
  • Track every dollar you spend for a month to spot trends
  • Plan ahead for large expenses like textbooks or travel
  • Avoid impulse buys — give yourself 24 hours before making a big purchase
  • Celebrate small wins like sticking to your budget or cooking dinner instead of ordering out

Final Thoughts: Your Financial Future Starts Now

College is a time to learn and grow — and that includes your finances. You don’t have to be perfect, but making smart choices now can set you up for less stress and more freedom down the road.

At American State Bank, we’re here to help you navigate this next chapter with confidence. Whether you’re opening your first checking account or learning how to build credit, our team is ready to support you with the tools, tips, and local service you can count on.

Start Strong with ASB

Ready to take control of your finances before college starts?

Open a checking or savings account with American State Bank today and start building smart money habits for life.

Checking Accounts

Savings Accounts