Introduction
While this article primarily focuses on real estate, specifically the goal of purchasing a house by the end of your college education, you should really be investing no matter what. I’ve outlined in other posts why I focus on real estate over other opportunities, but for a quick review, here’s why that’s the goal: you have a place to live, a source of income, and control over a large asset all-in-one.
How Much do I Need to Earn?
Before we talk about how you can pull this off socially, academically, and sanely, let’s first justify the reason mathematically. The key to our plan is aggressive saving and investing while in college, particularly in REITs. By consistently earning and investing, here’s how much you could have saved up by the time you graduate:
- 4-year degree: ~$56,726
- 5-year degree: ~$73,967
- 6-year degree: ~$92,639
(Why take more than 4 years? Want to check my math? More on that here and here, respectively.)
This is based on investing $1000 per month in REITs, including reinvesting your quarterly dividends. While this is by no means required, I highly suggest earning at least $45,000 per year, or at least try to average $3750 per month for quality-of-life. It’s okay if you earn less, and it’s okay if you invest less, but I strongly suggest searching for the highest paying job you can get, always searching and applying for higher paying opportunities, and making school work around your job and not the other way around. More on that below.
Not Just Investment Savings
- Structure & discipline: Balancing work and school will help you have a predictable schedule, making planning things like study time and time with friends a breeze, and in many cases allow for built-in study time while you’re working.
- More disposable income: Enjoy a better quality of life while still securing your financial future. You’ll really notice the extra cash in your account when you don’t need to “have sleep for dinner” or make ice-cube sandwiches.
- Better living conditions: Afford a better place to live rather than settling for subpar student housing. Even an extra $100 a month can make a world of a difference in your mental health, or even just let you have the extra push to go from a shared room to a private one.
- Improved insurance benefits: No need to wait until you can see your cavities and taste your strep throat—better insurance means better healthcare access, regular visits to the dentist, and better access to mental health and medicine through college.
“I Have Money From X, Why Even Work?”
Why work if you got a scholarship? A full ride? Saved in high school? Money from parents or relatives?
- None of these things buy you a house. Scholarships, parental support, and student loans might cover day-to-day expenses, but they won’t fund real estate investments.
- If your parents are buying you a house, you probably aren’t reading this.
- Working with existing financial support lets you get even further ahead. If you’ve got room and board covered already, or if mom and dad or footing the bill, you have the luxury of flexibility: flexibility to spend, flexibility to invest, or flexibility to earn. You can spend more money and still invest $1000 per month. You can keep you spending equal and invest even more than $1000 per month. Finally, you can just work less hours and still save $1000 per month. Added flexibility will let you pull ahead in any way you want.
Other Financial Perks of Working
- Higher-limit credit cards: Open more credit cards with higher limits. Build a strong credit history, which will help secure better mortgage rates later.
- Pay off loans sooner: Reduce financial burden post-graduation by making payments while in school.
Addressing Common Concerns
“I’ll Fall Behind My Peers”
My number one tip: If in doubt, spread it out.
If you take nothing else away from this post, take this line of wisdom. A lesson hard-learned and hard-earned. I was a junior in three different programs before I graduated, and it wound up taking me six years. Long story short, I could have slowed down my education, spent even more time working, and I would have graduated at the exact same time had I simply slowed down. Working in different fields while in college ultimately led me to choosing a degree and a career. If you’re in doubt about your degree, your future, or your career, don’t rush to the finish. Instead, spread out your coursework, spend more time earning, have more money for dates and good food, and take the time to truly master your chosen field.
- Work multiple jobs strategically. This may sound crazy, but hear me out. Look for on-campus jobs like TA or RA positions that allow you to study and earn at the same time. These can free up time to work fewer hours elsewhere while still maintaining an income.
- Prioritize benefits where possible. While full-time work is ideal for securing benefits, sometimes the tradeoff is worth it if it keeps your GPA strong.
“I Won’t Have Enough Time for a Social Life”
For starters, most of the “social life” happens in two ways: on campus and in the evening. Let’s tackle campus first since that’s the easiest. Since you’re a college student, you’re gonna be on campus for your classes. See? No need for FOMO.
I found that a majority of the weekday shenanigans, planned or spontaneous, were well into the evening. I usually finished work every day between 3 and 6 pm, but most of the time I was going out with friends or on dates, my night wasn’t even starting until 8 pm anyways.
“I Won’t Have Enough Time to Study”
- Most, if not all entry-level jobs will be paying you to just study 80% of the time. If you’re smart about the job you choose, more on that here, you will find that many employers are not paying you to work; they are paying you to be available. Sure, some days are busier than others. But for a majority of the time, you’ll be collecting a paycheck while studying for exams and finishing up projects.
- Work part-time during heavy semesters, full-time during lighter semesters. If you know you have an extra hard semester coming up (like that killer multi-variable calc class or OCHEM next winter), ask ahead of time if part-time work is available. No need to quit your job—just find a balance.
- Your study groups can meet you after work. If they can’t, get a new study group. I had a lot of classes that focused on group projects or peer-reviewed writing assignments, but I only ran into a problem twice, but never because work was getting in the way (my study partners were just ignoring me lol).
Conclusion
Balancing full-time work with college is a challenge, but it is one of the smartest moves you can make. Not only does it prepare you financially for homeownership, but it also provides structure, financial freedom, and invaluable career experience. If you take nothing else away from this article, remember: If in doubt, spread it out.
Want to dive deeper?