Going to university, for some, is a rite of passage but it may also be the first time you will have left home and stood on your own two feet. Feeding yourself, washing your own clothes, having total independence over your life can be daunting, especially when you throw student budgeting into the mix.
Here at UKDS, we want to help you with student budgeting and feeling like you have gained control over your finances. Control and confidence in these areas really help in the long term and provide you with the financial clarity to avoid getting into any sticky financial situations.
We’re saying don’t bury your head in the sand. Be aware of how much you have coming in and what you need to spend your budget on.
Your student loan is paid directly into your nominated bank account at the start of each term. For many, it is the first time that a large chunk of money has filled their accounts and it can be tempting (oh, so tempting!) to splash the cash, particularly in Freshers Week.
Our advice? Don’t do it!!!
We’re not being the fun police here either. Go out, make friends, have fun, spend money BUT only once you have worked out how much exactly you have to spend on socialising.
Visit our blog post HERE on how to work out your budget. Don’t be like some people we know, who when they were students, blew all of their student loan in the first month and then only had enough money to live off bran flakes for the rest of the term!
Having a credit card can be a great way of building up your credit profile…but only if you can pay it off at the end of the month in full.
Students do not always have an income therefore racking up debts on a credit card when you may not necessarily be able to make the monthly repayments in full could be dangerous.
However, if you budget carefully then a 0% purchase credit card could be a very good way to build up your credit profile, which in turn helps when you graduate. Many students use their credit cards to buy a monthly shop on it and pay it off in full at the end of every month. If you are diligent and financially savvy then this is a great idea. If you think that you may forget or be tempted by the credit amount available to you, then step away!
You may be living in halls of residence which is slightly easier to manage because all rent etc is done through the university. However, some students choose to live in privately owned accommodation, which is in association with the university, but managed by private landlords.
If this is the case then it is a good idea to understand your rights when it comes to renting.
Tenancy deposit scheme – Landlords have 30 days from when receiving your deposit (which is usually a month’s rent) to secure it in a tenancy deposit protection scheme. If they fail to do this (which is a legal requirement) then you could be entitled to up to four times the amount back.
Fees and contracts – You may need to use a letting agent to find a property. Before you take on their services, ensure that you know of any extra fees that they may charge (credit checks, admin charges, etc) and factor those into your budget.
Always, ALWAYS check the contract before signing it too.
Your rights as a tenant – There are different types of tenancy agreements in law and which one you have signed up to will affect your rights. Generally, private landlords will place you on an assured shorthold tenancy and this is what you need to look out for. This guarantees that you have the right to stay in your accommodation for the duration of your agreed tenancy unless the landlord can convince a court that there are good reasons for eviction. These would include being in arrears with your rental payments, damage to the property or that an express term has been broken.
Bills – Occasionally, student digs will include bills in the rental payments, however sometimes they do not and this needs to be factored into your budget. There is a warning in this – if you are combining bill monies in a joint bank account with your housemates, then be aware that you will then become financially linked which means that when you apply for credit in the future, any linked people will be considered too.
Made for those who are in higher education, these bank accounts come with benefits such as interest free overdrafts, discounted train travel, etc.
These overdrafts can be a brilliant buffer whilst you are at university. Ensure that you are looking into which ones provide the longest 0% interest free overdraft term too.
Ensure that you factor contents insurance into your student budgeting tracker. You may be covered by your parents’/guardians’ home insurance so check this first. If you aren’t covered by that, then there are specialist insurers out there (who are usually there at the Freshers Fair), such as Endsleigh who can provide cover.
Everyone loves a freebie or a discount, don’t they?
If you are going onto higher education then you NEED an NUS Extra Card in your arsenal. You’ll need to pay for it (£12 for one year, £22 for two years and £32 for three years) but you will more than make your money back in the savings that you make on clothing, food, etc.
You can use your NHS Extra Card to apply for a Railcard too (you can apply for a 16-25 Railcard without this however you will not benefit from the 12% discount).
We hope this has given you some tips on how to make your student budget go further. Of course, there will be many more budgeting tips that you will pick up along the way. Please feel free to share any in the comments.
We deal primarily with UK debt, specifically IVAs, however we are on a mission to provide the UK population with financial insights and financial education, allowing you to take control of your finances.