College students can be millionaires.

Jonitta Sheppard manages her money like most SMU students – her money goes, but it never grows.

“I’m a spender more than a saver,” says Sheppard. “But I spend on necessities: food, clothes and road trips.”

Sheppard tries to watch her spending habits, but she doesn’t have a budget.

Like most students, her spending is dictated by the amount she has in her checking account.

College can be more demanding financially than academically for some students.

They are the target of marketers, every weekend comes with a price tag, and the restaurants, cafes and coffee spots on campus run the dollar bills right out of the wallet.

Students say that their daily expenses can easily be $10 to $20. Students also say that in addition to room and board, they spend too much money on frivolous items.

But who’s counting, or shouldn’t someone be counting?

Financial experts say that college students need to learn the difference between necessities and luxuries. Ron Cole is an investor representative for Edward Jones Investments in McKinney. Cole has advised individuals for more than 25 years.

He views a student’s spending habits as the biggest challenge while they are in college.

“Students need to understand the difference from immediate gratification and gratification for the future,” says Cole.

Cole believes money is not the most important factor.

It is time. He says compound interest is the eighth wonder.

In examining individuals portfolios, he has witnessed money accelerate over time.

Cole illustrates the power of compound interest with a millionaire model that can benefit students by investing rather than spending their daily expenses. For example, Cole says a student can become a millionaire by the age of 65 if he or she was to invest $10.50 a day into a growth and income mutual fund for 10 years and not touch it until the age of 65.

“Students can create wealth if they motivate themselves to put money aside,” Cole says.

Javier Creixell, an SMU senior, decided at the end of his sophomore year to evaluate his spending habits.

In the summer of 2005, he invested funds that he received from his grandparents into a certificate of deposit account. While he is in school preparing to graduate, his money is making high returns sitting in the bank.

“I realized that after I graduated I might need something to fall back on,” said Creixell.

He acknowledges that saving is the last priority for college students.

As a student majoring in marketing, Creixell observes the influences and temptations students encounter from credit card solicitations.

“One summer a friend of mine got six credit cards,” Creixell says. “Now he plays the balance transfer game.”

Cole says the credit card game is a good example of the power of compound interest working against students.

He is amazed that students are unaware that their money is consumed by the credit card company’s interest rates. Cole is convinced that once students realize they can produce wealth instead of lose it then they may be motivated to save.

Kristina Kiik is a first-year law student at SMU.

She does not remember ever drafting a budget her freshman year in college. As an undergraduate student, she worked for the nonprofit organization Dallas Committee on Foreign Relations.

Her father would constantly encourage her to take 20 percent of her paycheck and save it for her personal expenses while in law school.

“I was young and stupid and didn’t follow my father’s advice,” said Ms. Kiik. “I started saving my junior year in college and now I am paying for it; I’m haggard, stressed and unhappy.”

Kiik is now a full-time law student and finding it a challenge to stay on a slim budget while she pays her student and living expenses.

Matt Kingore is an SMU graduate student. He became concerned with his finances his senior year in college.

He viewed his spending habits like most undergraduate students: the majority of his budget was for necessities and beyond the bills were for entertainment and clothing.

“Today I am on a stricter budget,” said Kingore. “I tend to watch where and how I spend.”

Cole encourages students that the sacrifices they make today can be the wealth they earn in the future. He understands the influence of want.

“We will always have more wants than we have money,” says Cole. “The key is to differentiate between a need and a want.”

Cole believes the first step to wealth is to create a plan. Cole advises students to look at their basic needs.

From this point, a student can develop a budget. Cole suggests that students should automatically add $25 to their budget and contribute that amount to savings.

He is confident students will be motivated to save once they see the wealth they can generate from temporary sacrifices.

Cole encourages students to sacrifice $6 a week for one year and put it into a mutual fund. Six dollars a week is equivalent to two visits to Starbuck’s or a matinee movie.

“That two or three dollars they spend on a cup of coffee can be good saving money,” says Cole.

Cole’s Three Part Strategy for Personal Wealth:

• First make a decision to have wealth. Understand and agree that sacrifices must be made.

• Develop a Budget: Separate wants from needs. Place the wants in the savings category. Think of what is going to earn you money.

• Discipline is where it starts. Critical factor to wealth is to have a plan and stay disciplined to stick with it.