Students learn many new skills at university. Financial budgeting is just another skill to master and, as with almost anything in life, being fully prepared will put you in a better position. That’s basically what budgeting is; having a plan and being prepared so you can focus on other important things, like your studies and future career.
Here’s our guide to budgeting as a student.
Start by assessing your potential financial support
You may be entitled to a maintenance loan, which is not a loan from the university, but from your local funding body. Bursaries, grants, scholarships or awards are provided by your chosen universities. You’ll need to talk to their support service to find out more.
You can refer to the following websites to enquire about funding.
- England: https://www.gov.uk/student-finance
- Wales: http://www.studentfinancewales.co.uk/
- Northern Ireland: http://www.studentfinanceni.co.uk
You can also use Family Action’s grant search to see if you qualify for funding from a charitable trust.
Jot down how much money comes into your account and how much goes out
Budgeting software is widely available, but a spreadsheet will do just fine for this. When people budget, they usually plan for the month ahead, but as you’re a student, your budget needs to be planned around when you receive maintenance loan or maintenance grant payments, which is normally delivered in three instalments. Generally this is spread over the terms of the year with a gap over the summer holidays.
So, if you’re paying rent for student accommodation in a three month lump sum, this will make your budgeting easier. You can then map out your main expenses such as rent and electricity and gas, and then estimate your day-to-day costs for food, travel and clothing.
Subtract the money you spend from the money that comes in
By subtracting what you spend from what comes in, you can to see how far your budget will stretch. Now, are you under or over budget? If you’re under, it means you need to take steps to help yourself. You may need to consider part time work. Or even cut back a bit on non-essential items. Once you know what your main expenses are, you can try to reduce them over time.
If you’ve got plenty of money left in your budget to spend, take a minute to be realistic and think about all the other expenses you might have. Consider things that you tend to spend money on often, such as coffee, cinema trips or gigs. Be as honest with yourself as you can and set yourself an allowance for each type of expense to stay within your budget.
Your budget may well highlight the need for a part-time job, or that you need to go somewhere cheaper for your haircut. Steps like these can help you to keep your account in credit. If you can successfully manage your finances as a student, then you’re in good financial stead for your entire working life.