How many Korean students are interested in financial technology? The Pharos conducted a survey of 60 university students. According to the survey, only 6.6% of the students are interested in financial technology. They have used financial instruments, and they think it’s important to use a personal budget book. The rest of the students barely care about their finances. Even trivial habits regarding money can be beneficial in the long run. Then, what can we do to manage money as a student?

The first thing we can do is draw up a personal budget book. It is the easiest way to manage money, but it could be the hardest at the same time. This is because writing down every single expense, which happens several times a day, and your earnings is not easy. Nevertheless, using a personal budget book is crucial as it is a fundamental part of money management. By using it, we are able to recognize not only our financial condition, but also our pattern of consumption. In the case of those who have bad spending habits, the personal budget book would provide them with opportunities to figure out their spending habits and reflect on themselves. Moreover, we can manage money by forming a habit of saving. This is not about unconditional saving. The thing is that we must not waste money on unnecessary things. For instance, we can save much money in the long run if we stop smoking and drinking. Last year, the cost of a pack of cigarettes almost doubled from 2,500 won to 4,500 won. If a smoker smokes a pack of cigarettes a day, the smoker spends 135,000 won every month. Given that students usually have only a little pocket money which should be expended on food and public transportation, 135,000 won is not a petty amount. Therefore, we have to spend less on luxury items.

Furthermore, if students not interested in financial technology acquire money through part-time jobs or scholarships, they are prone to wasting it. In this case, if students pay more attention to financial instruments, they can avoid money loss and receive benefits. Therefore, we will have a look at what kind of financial instruments there are.

1. Regular Installment Savings Account

A regular installment savings account is a kind of contract that requires you to deposit a certain amount of money per month for a given period of time. When the contract ends, you receive the money and also the interest. While you are registered for the account, you are prohibited from withdrawing any cash. The product is created for people with little money to save and earn interest without wasting money.

A regular installment savings account can be a great way for students to start to manage their property. First, university students are technically students, which means that they have limits to their economic activities. Therefore, they need to learn to save and manage money. Since students are required to deposit money every month, it can give them opportunities to learn to save. Second, they cannot withdraw freely until the contract expires. Of course, you can cancel the account. However, you will lose a significant amount of the interest you have accumulated. This characteristic also restrains extravagance. In many ways, if students make use of the account diligently, they can obtain more cash than they put in depending on the interest rate.

2. Merchant Banking CMA (Cash Management Account)

A merchant banking CMA is a kind of account that takes advantage of short-term financial instruments such as CPs and CDs. By investing in this account, you can expand your finances in a safe way. The traits of the CMA are as follows. First, the depositor is protected and there is no loss of principal. Thus, unlike funds or stocks, cash can be kept secure. Second, the interest rate of a CMA is higher than that of an installment savings/checking account. Even if you deposit money only for a day, you obtain interest. Third, you can always freely withdraw cash. However, this account does not impose the duty to deposit regularly, which does not educate students to manage money. However, for great cash managers, it can be a fine way to multiply money.

When students start their social lives, they may face financial problems related to marriage, buying property and a house, and after retirement matters. In order to prepare for these, they need to be more thrifty. If students refer to the tips above and start studying about financial matters, they will certainly deal with future difficulties easily.