Timeline – Students’ Spending Habits in the US

How do students spend money in the U.S.?

It’s actually quite amazing when you think about how the spending habits of students change over time.

For the first 3 months of your stay in the U.S., you will be spending at the bare minimum for every expense.

But after 3 months, you could see changes in your spending habits.

Having a credit card in hand changes one’s perspectives of money.  Here’s a time line on how spending habits change over time in U.S.

The First 3 Weeks

Your mental calculator will be always at work.

Anytime you see some new products, you will be “automatically” multiplying by Rs.50.

Most likely, some of your seniors or friends will take you to Walmart or nearby major retailers for shopping.

When I went to Walmart for the second time, my roommates and I spent around $100.

I was amazed to see my grocery bill to cost so much!

For $100, we would already buy so many stuffs back in India.

If you don’t have a part-time job, financial aid or scholarship, for the first few months you must hold yourself back from spending.

So, the average monthly spending for the first 2-3 months will be at the very minimum.

Because you don’t have much cash at your disposal, you will likely think twice before making purchases.

After 3 Months

You will have SSN and probably a credit card with around $1,000 credit limit.

This will be the moment when you will start feeling comfortable with the U.S. Dollar.

Your mindset will then get adapted to the value of the U.S. Dollar.

You won’t feel any pain when paying the credit card until the statement comes.

Money becomes virtual.

You don’t carry cash in hand or in wallet.

It’s in the bank account.

You’re using credit card or debit card.

When the statement comes, money from your bank account is transferred to your credit card account.

You will start using credit cards everywhere you go.

  • $3 at McDonalds
  • $5 at Taco Bell
  • $7 to watch a movie

All these small expenses add up.

You will be surprised to see how much you have spent by the end of the month.

You will wonder, if I have a small part time job for 10 hours, I can earn from $200 to $300.

$300 is lots of money. You can pay for groceries and part of your living expenses.

That’s the phase when every student will become aware of the real value of money.

After the 1st Semester

By this time, you should have found a job (part time, financial aid, or research assistantship). Unless you control yourself with the excitement of getting a new job, your first pay check will be already be spent long before you actually receive it.

It is very simple. For many months, you will be living within a strict budget, consciously controlling how you spend your money. But after you get a job, the first thing you’ll experience will be to feel happy and relaxed. You will then make some mental calculations, such as on how much you will earn per week, per month, for 6 months. All those long awaited dreams will become more clearer mental pictures, like having a nice digital camera, once-a-week buffet at an Indian restaurant, an iPod, etc. Next thing you know you’d find yourself about to…

Buy a Cell Phone (nowadays, it had become an essential)

  • iPod and iPhone
  • Dine out in restaurants daily
  • Visit deals2buy and edealinfo daily looking for new gadgets
  • New pair of shoes every month
  • Subscription to Netflix
  • Buy X-box or Wii
  • Flat Screen TV sharing the cost with roommates
  • The “List” never ends

So that would be your first paycheck money already spent. Most of the students end up spending with their credit cards and are left with additional $20,000 in credit card debt. At times, this will reach around $45,000 in loans to be paid.

Now, having been used to little a lavish lifestyle, it will be little difficult to go back to the previous lifestyle. The next step would be to apply for a new credit card, and then what would happen next? Students will incur a large balance in credit cards debts, and lots of balance transfers will go on and on…

“How to avoid student credit debt” and “Some nice ways to keep students’ finances under control” will be discussed in the next posts.

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  1. I completely agree with the above , I am an Indian student who studied abroad and the former part did happen to me , I did convert the dollar into the rupee for the first few weeks . But as it is said …”do in rome as romans do” …i learnt not to convert d currency
    though if u r cautious about spending you do learn spend intelligently …the anti-thesis is that once you start spending on your own u r more cautious with money …some learn initially ,others learn after they get a huge credit card bill at the month end..

  2. Yeah Dude this is cool of you to share this experience with us…..

    Hey Purna Chandra where did you take admission, and how is your progress goen on ??

  3. Hi All,

    Above said is very much true..It holds good not only in USA but in India also. Take my case, I am working in Big Software company and earning decent salary and it all started with Credit Cards. Once i got credit cards, mind started wavering about pubs,bars,restaurants, shoes,new dresses…what not i started to njoying life to the fullest but without any control on my spending habits. This has resulted in huge debts and still i am paying those debts….very imp lesson i learnt is never bite a chunk more than you are capable of eating
    I just wanted to write this message after seeing the above one. Anyhow i am fixing my visa appointment somewhere in next week and if everything goes fine i will be in USA very soon and this lesson is going to be very helpful for me coz i understood if v r not capable of controlling things which r in our hands we can’t control our life after some period of time…

    Please excuse me if my message resembles to anyone of your’s and if it hurts you.

    1. please tell me how much money should we have at the begining of the 1st semester and survive till end of financial situation is sligtly weak pls reply

  4. .. I'm thankful to this blog as it was very useful to students like me .. after to days im going to write gre exam and im afraid that what happens if i get less score.. some are saying that i wont get aid if i get good marks in gre .. is that so ??? do i need to pay whole fee by my own ???

  5. I guess that was a nice idea lifestrikes. Monitoring your spending habits can be of big help in keeping out of debt. There’s an article about ways to Avoid Student Credit Card Debt which I think can open the minds of the students on how they can have a debt-free way of living.

    1. I am one of them, i got 11000 $ on my credit cards, not having a job since 13 months, MS in mech engg from Texas and now I want to go back to India. So please tell me is there a problem for me if i dont pay a single penny to all the banks ? Let me asap …. thanking you

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