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Along with your high school graduation you’ll receive a diploma, lots of good wishes and, oftentimes, a good amount of cash gifts.

Your family and friends will gift you money to “use for college,” but what’s the best way to do that? Before your newfound wealth burns a hole in your pocket, consider these money tips from financial experts so you can spend (and save) it wisely.

Give the Money a Purpose

“The first thing you need to do is decide how you plan to use the money you’ve been gifted,” says financial coach Ashley Feinstein Gerstley, founder of The Fiscal Femme and author of The 30-Day Money Cleanse. Will it be your spending money or should it pay for first semester’s books or go toward tuition? There’s no right or wrong answer here — but the money needs a job. 

Even if you decide to use it for spending money, then “set yourself up with a salary, so you transfer a certain amount to your checking account each week,” recommends Gerstley. This strategy means doing the math of dividing up your spending money by the number of weeks in your freshman year and giving yourself access to only that amount each week. “If you only give yourself a certain amount of money to spend, you won’t run the risk of blowing it all in the first month,” she explains. 

It’s important to have an emergency fund no matter what phase of life you’re in.

– Lauryn Williams

Create an Emergency Fund

Looking ahead to life after college, most financial experts suggest setting aside enough money to cover 3–6 months of expenses in an emergency fund. It’s practical advice once you reach that point, but there’s no reason you can’t start laying the foundation now. In college, consider starting a scaled-back emergency fund, says Lauryn Williams, founder of Worth Winning. “Set aside a little of your college money in case something were to pop up and you needed to get home in a hurry, for example,” she says. “Or if you get a flat tire and you need to get back and forth to class. It’s important to have an emergency fund no matter what phase of life you’re in.” 

Open a High-Yield Savings Account

Once you’ve made a plan for your money, you need to stash it somewhere. “I’m a big fan of online, high-interest savings accounts,” says Gerstley. “There’s something magical about having something out of sight, out of mind.” If you already have a savings account, Gerstley still suggests opening a separate one just for your college gift money. An online, high-interest account will mean you’re earning more money than if you parked it in a traditional savings account, which tends to have a lower interest rate. Try not to let your graduation money get intermingled with other money you’re spending. “By putting it in its own account, you’ll know exactly where the money is that was gifted to you and what it will be used for,” says Gerstley. “If you put it with other money that you spend regularly, it’s easy to start dipping into the funds you had saved for school, and the next thing you know, it’s time to start school and all of that money is gone.”

Track Every Penny

“I’m a big fan of money journaling,” says Gerstley. “It’s old-school, but I find it’s really important to be aware of how much you’re spending.” Whether you use pen and paper or an app, Gerstley’s only rule is that you manually enter where every dollar goes. “Doing it manually gives you an extra layer of consciousness.”

Make a Budget When You Get to Campus 

Your pre-college spending may look very different from what you have to pay for once you’re on your own, says Soraya Morris, lead trainer at MoneyGuidePro. She advises using the first month or two of school to gather data: How much is gas, your public transit pass, grocery shopping and dining out? Give yourself time to see what your expenses look like so you can create a realistic budget for your graduation money. Find a balance between costs you need to cover and some fun expenses. Sticking to a budget doesn’t mean you can’t enjoy yourself. “Don’t say you’re not going to spend any money eating out — of course you will,” says Morris. “Just be honest and put some aside for fun things you want to do. You don’t want to deprive yourself of the full college experience.” And neither do the people who gave you that graduation money. 

Being thoughtful and strategic about your graduation money is a smart move — and it doesn’t have to stop there. You can put these financial best practices to use no matter the source of your money, whether that’s holiday cash from your grandparents or paychecks from an on-campus job. Spend wisely now and you’ll set yourself up for a solid financial future.

 Interviews for this article were conducted in 2019.