The B word … (Budgeting)

“If you fail to plan, you are planning to fail!”

― Benjamin Franklin

For many students, university is the first time they are faced with actual financial responsibilities, such as: rent, grocery shopping, laundry, purchasing text books, printing etc. University is an opportunity to become independent and begin adulting (To adult is to behave like an adult, to do the things that adults regularly have to do.) Unfortunately, one of the stigmas associated with students are that they are financially irresponsible and ignorant. For example, the idea that students just waste their money on drinking and going out. Experience is the best way to learn sometimes, it’s ideal to learn from others mistakes but sometimes the biggest lesson learnt occurs when we learn from our own experiences. The following are areas to consider to enable financial success as a student.


Student bank accounts

First of all, do your research on the student accounts available by various banks because they all have different features and deals. For example, if you choose to open a student current account with Santander, they offer a free Santander 16-25 Railcard, and an interest-free overdraft. Try to find ones with an interest free overdraft and make sure to set a reliable overdraft limit. Budget your cash inflows and outflows. Make use of online banking tools, this is very convenient and some even give you text alerts to inform you of when you’re reaching your limit.

Ensure you understand the terms and conditions attached to the student account (actually read them don’t just tick accept like we all do). Also, avoid credit cards if you have a tendency to overspend, you shouldn’t spend more than you know you will be able to pay back. However, if you have one, this could be an opportunity to build your credit score but you should limit using it for emergencies only.

It’s never too early to start saving

The key to budgeting is organisation, this can ensure you are living within your means. It’s ideal to budget your expenses termly and prioritise them e.g. accommodation rent being the top priority. If you’re working part time and you can afford it, you could start saving. The 50/30/20 budget rule is a proportional guideline that can help you keep your spending in alignment with your savings goals. This budget rule suggest you spend 50% of your income on essentials, 30% on personal expenses and the remaining 20% should be for savings. This rule is especially useful when saving for specific goals, for example, buying a car or moving out of parent’s house relatively soon after graduating. However, there is no harm in saving in general for unforeseen emergencies that may occur.

Part – time jobs can be a great way to not only earn extra money but also gaining some work experience and developing those soft skills (transferable skills that employers are looking for).  It is important to be realistic with the hours you work a week, your first priority as a full time student should be your university work, so working should fit round that. If you have a free day on your timetable, then you could use this day to work most if not all your hours or just work on the weekends. Also, note that you can avoid working during term time by working during the holidays, try casual jobs that are ideal for students like hospitably.

Cut costs where possible

Have a night in! Going out can be expensive, from the cost of the cab to the cost of buying drinks. You don’t have to go out every weekend, you can have some quality time with your friends with a games night or movie night. Learn to cook! Relying on take away alone, although convenient is very expensive. Google and YouTube can be life savers when it comes to figuring out meal recipes and ingredients needed. Also, you can meal prep in advance and store in the meals in the fridge, for example on a Sunday ahead of the week to avoid spending too much time in the kitchen during the week.

Apart from tuition, housing is probably the second highest expense for students. Although student finance provides maintenance loans depending on your circumstance, it is important to note that if you start to earn a certain mount after university you will have to start paying back your loans. Currently, you pay back 9% of your income over the minimum amount. Interest starts being added to your loan from when you get your first payment. How much you pay depends on which plan you’re on. Many 2nd year students get cheaper off campus accommodation which helps them save money. However, for some people comfort is very important so there are some things when it comes to housing that they are unwilling to budge on (e.g. having an en-suite bathroom). Weigh the advantages and disadvantages to see what’s best for you.

Whether you’re making online grocery orders or doing some online shopping for clothes, make use of store cards and take advantage of student discounts! The NUS extra card provides great student discounts that you can use online and in store, top brands include ASOS and Odeon. UNiDAYS are another student discount provider, that offer big savings on student essentials from your favourite brands. They are an entirely free online system with no sign-up cost, no membership card. The Purple card is a discount card that can be used by staff and students at Lancaster University and the University of Cumbria. It’s accepted by major retailers all over the UK.

Lastly, beware of hidden or unexpected costs such as the college membership fee. This money is put to various uses by each college.  You need to pay this to graduate as part of a college! Also for more ideas about budgeting there are many useful blogs, books, YouTube videos and of course information on Google!

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