- Getting a degree is quite expensive.
- Here are the top ten essential money tips for students.
Making every penny count lets you squeeze every drop of fun from your uni days without getting saddled with debt.
1. Work out a budget
It is hard to set a precise weekly budget before you get to university and see what things really cost. However, trying to work out an outline budget before you go is still a good idea – even a rough idea of how much money you will have available each week will help you to avoid blowing your budget early.
The simplest way to do this is to make one list of all your monthly income (e.g. from loans, part-time work, the Bank of Mum and Dad) and another listing all the expenses you can think of.
Remember, the more accurate you can be when predicting expenses, the clearer the picture of your money situation will be – include everything from rent, bills and food, to things like books, library fees, transport costs and laundry. Once you have both lists done, subtracting your total weekly or monthly expenses from your total income over the same period will give you an idea of how much is left over for entertainment.
2. Get the right bank account
Your choice of bank account, and particularly your overdraft facility, is very important. Before you choose, work out what features are important to you – paying particular attention to monthly fees, overdraft charges and such. Over the long term, they will be much more important than the gifts and incentives that many student accounts offer. The main things to look for in a student account are:
overdraft facility and fees: Find out how much you can borrow and how much will it cost each month. Some charge a monthly fee for using an overdraft, whilst others will charge interest on the debt and some will even offer you an overdraft that is interest free while you are a student (although you will be charged interest later on when you graduate). Which works for you depends on how much you are likely to go overdrawn each month. Feature to look out for :
- Interest on balance
- Monthly charges
- Access to your money
3. Spend money wisely
With these basics in place, you are in a good position to manage your student finances effectively. But it is no good planning your finances if you then spend money hand over fist once you get to university. Try to stick to the budgets you set out by shopping around for bargains and saving money on 'essentials' wherever you can. Consider:
4. Buying second hand book
You can often find course texts for sale at knock down prices at the university union or by searching student notice boards.
5. learning to cook
You will save a lot of money if you can cook yourself a few basic meals, rather than relying on ready meals and takeaways. Clubbing together to save money on food: If you live in shared accommodation, club together with your housemates when buying food.
6. Be smart about part-time jobs
Many students rely on part-time jobs to cover monthly bills and to pay for nights out and socialising. If you get a job, remember:
don't overdo it: Try not to work more than 25 hours per week so you can keep up with your studies.
7. Look after your finances
It is vital that you keep a regular eye on your finances – do not just assume that everything is OK.
Review your bank account regularly: This way you will always know how much money you have. You will be better able to avoid unwanted bank charges (e.g. unauthorised overdraft fees) and will be less likely to run out of cash altogether.
Plan for regular bills: Ideally, you should set up direct debits for everything from rent to utility bills. That way you will know exactly how much you spend on each and when the money will leave your account. It can be useful to have a separate 'bills' account so you never accidently spend cash that was needed for essentials.
Sign up for online banking: This will enable you to check your balance, and which direct debits have already been paid, whenever you want.
Don’t let problems mount up: If it looks like you are running out of money, or cannot cover your bills, get help straight away. Talk to your bank and to a student adviser (through the National Union of Students) to see what help might be available.
8. Make more from your student loan
If you are taking out a student 'maintenance' loan to cover living costs, you will be paid a lump sum at the beginning of each term. When you receive each payment, put it in an instant access savings account (keeping enough back to cover your immediate needs). That way, your loan will earn interest and you will be less tempted to blow it all straight away (and won't be able to spend it 'by mistake'). If you plan to do this, shop around for a savings account.
Opt for a savings account that pays the highest rate of interest.
Make sure you will be able to access your money, without penalty, when you need it. Read the terms and conditions before you commit yourself.
9. Protect your identity
Online banking fraud is on the increase, so take steps to protect yourself. Take the time to find out what the threats are and how to avoid getting caught out.
Remember that bank and identity fraud does not just happen online. Particularly if you live in shared accommodation, be careful that you do not leave items such a bank statements and bills lying around.
Do not throw bank statements in the bin. Either keep them somewhere safe, have them sent to your home address or shred them before you throw them away.
Do not give out your PIN number to anyone.
Never write down your PIN.
Ask your bank to send replacement cards to your home address, not your student address.
10. Protect your possessions
Finally, make sure your possessions are covered by adequate home contents insurance. This is a must as both halls of residence and student housing tends to be incredibly popular with thieves.
You do not need buildings insurance (this is the responsibility of your university or private landlord).
Make sure your cover is sufficient to protect all your possessions.
Shop around and get quotes from a number of providers so that you don't pay more than you have to for the cover you need.
Pay attention to the terms and conditions, to make sure you are protected.
Make sure any valuable items, like computers and bikes, are properly covered. Some policies have a 'single item' limit (which means that any single item is only covered up to a maximum of say #200,000) and insist that any such items are listed on the policy.
Be honest when you apply. If you do not tell the whole truth your insurer may refuse to pay out if the worst happens.
Opt for a policy excess you could afford if you have to claim. The excess is a set amount of any claim you have to pay yourself before the insurer will contribute (the first £50 for instance). Having a larger excess will bring down your premiums, but will cost you more if you need to make a claim.
Source: money.co.uk
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