If you’ve never been broke--like, broke-broke--it’s safe to say you’ve never been a college student. Some might say it’s part of the ambiance. Some might say: This sucks. I’m broke, and it’s a daily struggle to get by.
Ramen noodles are a dorm room delicacy, sure, but eventually you’d like to eat something with a few more vitamins and minerals.
You know once you graduate you’ll land a rewarding career and work your way up into professional greatness, but you’ve still got a few more years in front of you of laundry at mom’s house and counting out change for a Taco Bell fourth meal.
What to do? In some cases, circumstances beyond your control leave you struggling. That’s always a tough spot to be in. However, in other cases there are some things you can do to help ease your wallet-related worries.
Poor budgeting is detrimental to many Americans. A study by the National Endowment for Financial Education found that roughly one fourth of young American lack “basic financial literacy.” Meanwhile, the Urban Institute reports that 77 million Americans have debts that are currently in collections.
Compound this by the fact that many college students are saddled with student loan debt in the tens of thousands of dollars and are working low-wage jobs during their undergrad years. There’s really no way for them to pay back their loans until after they graduate and enter their degree field, so being in school is mainly a time of acquiring debt.
Luckily, budgeting is one of the things sororities do best. The sorority treasurer is tasked with working magic with chapter finances, and the good ones get results even when it seems the numbers don’t add up.
In other words, if you’re a sister with budgeting woes, the best lesson is to turn to your treasurer for help. That’s why OmegaFi wants to give you a crash course in Being Broke 101: What Sisters Can Learn about Budgeting from Their Sorority Treasurer.
Sorority Treasurer Lesson #1: Budget for What You Need, Plus a Little More
One of the most important aspects of chapter budgeting is keeping the finances out of the red. In fact, it’s the reason you have a sorority treasurer in the first place.
When it’s your own bank account it’s easy to spend too much without noticing until later, and even then it’s easy for you to keep making the same mistakes when you get next month’s paycheck. Budgeting for a chapter could mean managing $100,000 or more and, for larger chapters, collecting membership dues from over 100 members.
The basic principles are the same. You budget ahead, looking to avoid debt. A sorority treasurer quickly learns that keeping the budget too tight will lead to deficits, since unforeseen circumstances crop up, and the estimated costs for chapter activities may grow. That’s why the treasurer must overestimate costs in a nuanced way, and when some things fall under budget, it creates a surplus.
By thinking ahead, overestimating monthly expenses, and keeping costs down, you can usually create a personal savings to use in emergencies.
The red is your enemy. You have to suppress your worst spending instincts and plan for the future rather than the present--something most of us are notoriously bad at. You must keep constant vigilance and make adjustments as you go.
Ask your sorority treasurer how she deals with the struggle of avoiding deficits, and you’re sure to learn a thing or two about budgeting.
Sorority Treasurer Lesson #2: Treat Your Money Like It’s Someone Else’s
Your time is precious. You hoard it when you can, stash away little moments for later. You try to optimize studying and other assignments so you can hit up the tennis courts and work off some stress, or to watch a movie, curled up on the couch with a significant other.
Why do you value your time, yet not commit the same level of planning when it comes to your money? This is an especially strange concept when you consider how much time you spend acquiring money in the first place.
A sorority treasurer must value the money she’s working with to budget for the chapter--because it isn’t hers. She can’t spend it on a night out, unless that night out is a social event accounted for in the budget. Each sister contributes her membership dues, and the treasurer is acutely aware that the funds must be used purposefully. She must stretch each dollar in order to give sisters the best sorority experience possible. In this case, money translates into time--time sisters spend together--rather than the opposite.
That level of careful and determined financial management is a great lesson for sisters to apply in their personal lives. Understanding how the sorority treasurer manages other people’s money will help you understand the value of your own.
Sorority Treasurer Lesson #3: Pass It On
Once you get a handle on good budgeting techniques, share that knowledge with your sisters. Educate them, without being preachy. Lead by example. If a sister complains about never having money, tell her about your past money troubles, and explain some of the major steps you took to improve your finances. If she asks you to go out on a night when you know neither of you has the cash in the bank, be honest about it. Offer to watch TV together with some salty snacks instead.
Sorority treasurers can provide meaningful financial lessons by giving a personal finance presentation to the chapter. They can pass on the sage secrets of their budgeting techniques during this presentation, answer questions and provide transparent access to the chapter budget, so sisters can understand how it functions.
No matter who you are, a sorority treasurer has many lessons sisters can learn and apply to their own lives about budgeting.
Sorority treasurers, past and present: What budgeting lessons would you pass on to your sisters? Give us your best pointers in the comments below.