When you are living away from home for the first time and responsible for managing your money, it is very easy to suddenly find that you are spending more than your income if you do not plan and budget and this can quickly lead to debt.
Here are some simple tips to help you manage your money and remain in control of your expenses. Budgeting does not need to be complicated and if you sit down and work it out at the beginning of term, it will be easier to get in to good habits from the start.
1. How much money do you have?
The first thing is to establish exactly how much income you have each term and for what period of time it needs to last. Be sure to work out the exact number of weeks and then simply divide the total income by the number of weeks to establish your weekly budget.
2. What are your weekly expenses?
Make a list of all the things that you will need to spend money on each week. Not all of your expenses will be weekly, but you can estimate what you might spend on certain things over the term and divide it by the number of weeks to get a weekly figure.
This is a typical list, which can act as a starting prompt
- Household bills - water, electricity, gas - these are generally paid quarterly, but it will help you to establish how much you need to save each week towards the bills, so you don't find yourself short when they are due
- Entertainment - cinema, drinking, clubbing, whatever your forms of entertainment are, you will need to budget for this too
Some of these expenses will be fixed - the same each month - and others will vary
3. Keeping track
Once you have your weekly budget, try and keep a record of the money you spend and what you spend it on. It is very easy to suddenly find that you have spent more than you thought - a coffee here or a chocolate bar there, that you use loose change for and suddenly you've spend £10 without realising it. At least to begin with, while you are getting used to managing your money, keep a record of everything you spend and what you spend it on so you can clearly see how your money is going. This will help you, if you do find you are getting in to difficulty, to identify where you can cut down your expenses. Regularly check your bank balance and statements - banks do make mistakes sometimes!
4. How to save money
Whether you need to cut down your expenses or you are just looking at ways to manage your money more efficiently, identifying ways you can reduce your expenses is always a useful exercise. If you do not think carefully about the things you are spending your money on, your outgoings can easily escalate.
Here are some simple tips to get you started:
Get yourself an NUS card - it entitles you to discounts in lots of places and can save you a substantial amount of money over the year. There are also lots of other sites giving you student discounts and offers, so while you are a student, make it your challenge to never pay the full price!
- Buying your food in big supermarkets is usually cheaper than in a mini market
- Ready prepared meals are more expensive than fresh ingredients which you prepare yourself
- Meat can be expensive. Try to eat vegetarian a few times a week.
- Freeze whatever leftovers you may have for another day
- Do not over buy in one go, as you may find you end up throwing things away which have passed their best before date
- Plan ahead - decide what you are planning on cooking for a few days in advance. It is easy to come home from college, starving hungry and grab a take away or ready prepared meal because it's quick and easy but it can also become expensive
- Cook with friends - it is cheaper than cooking for one
- Look for discounts, money off vouchers and special offers
- Get a loyalty card from your local supermarket
- Make sure you take advantage of all travel cards or student rates.
Your parents have been telling you these things for years, but now is the time to take notice!
- Turn off the lights if you're not in the room.
- Don't leave your electrical items on standby over night.
- Whenever possible, hang your clothes out to dry instead of using the tumble dryer
- Don't put the dishwasher on if it's not full
- Do your washing on 40C unless you're trying to wash out stains. Do the washing when you have a full load
- Have showers instead of baths
- Make sure your heating isn't on while you are all out at college
- Block up draughts from badly fitted windows and doors. Don't waste money heating the street!
- Look out for cheap entry to cinemas and clubs
- Discount vouchers are readily available for many high street restaurant chains. Sign up for email alerts with your favourite restaurants and you will receive all their latest offers
- Many clubs have student nights when the drinks are cheaper than usual
- Many clothes shops do offer student discounts. Make sure you check before you buy and use that NUS card!
- Buying clothes from charity shops can become a creative challenge. You can often find some very nice things in charity shops that have hardly even been worn if you are determined and have the patience to sort through. A good wash and you have yourself a bargain.
- You will be a given a list of recommended reading when you first start your course, but before you rush out and spend loads of money on books, check with students from other years. Maybe they have one they don't want any more or didn't find it useful and can advise you which ones are worth buying. There are often second hand books sales on campus or you can find the books you want on sites such as www.abebooks.co.uk
- Don't forget the good old fashioned library too, although popular textbooks can sometimes be hard to find unless you get in quick!