Budgeting tips for students

Being in university causes a lot of stress for most of the students. It is extremely difficult to focus on your studies while having to worry about your financial status every moment of the day. I have been in this situation; it was my first year in university and my first year living alone in a new country with no job. I had to come up with a solution, as I wanted to be able to manage well at university. Here are some tips about how to plan your budget:

1. Add up your total student income.

For example:

• Maintenance loans
• Income from a job
• Bursaries, scholarships, grants, etc
• Money from parents or family
• Any savings.
  
  

2. Once you have calculated your total income, it is time to calculate your expenses:

• Groceries, (Essential expenses)
• Any bills – e.g. water/gas/electricity, phone, wifi, etc, (Essential expenses)
• Accommodation fees – e.g. rent and deposit, (Essential expenses)
• Travel costs in case you drive – e.g. fuel, insurance, maintenance, bus/train tickets, (essential expenses)
• Course materials, (essential expenses)
• Any night outs, (you can choose a budget, for e.g. you can only spend £X every week in nightclubs or drinks with your friends, (non-essential expenses)
• Hobbies, (non-essential expenses);
• New clothes, (non-essential expenses);

3. Calculate your weekly budget

It is important to make sure that your income is either more than or equal to the outgoing expenses. You never want your income to be lower than your expenses.

Now that you know your expenses, it is time to calculate your weekly budget. With these calculations, you will find out how much money you have got to spend in everything that is not essential each week.

First, you calculate your total income for a term at university (e.g. £4,500) and you add up your essential expenses (e.g. £2,250). For a 16-week term you just need follow these simple calculations:

(Total income for a term) – (Essential expenses) = (Money to spend on non-essential for the term)
e.g. 4,500 - 2,250 = 2,250

Then you divide the money to spend on non-essential for the number of weeks of the term to calculate what you can spend every week on non-essential items (e.g. 2,250 / 16 = £140).

It is always a good idea to, occasionally, put some money in a piggybank so you can always have some long-term savings. For example, if you only spend £120 in a week, you can put £10 in the piggybank and save the other £10 for the next week’s budget.

4. Challenge yourself and set some goals

I always find budgeting a challenge. Managing is all about setting goals to reduce your spending. Being on track of what you spend is vital if you want to have a reasonable budget at the end of the month. It surely isn’t fun to realise at the end of the month that you spent £200 in drinks in the pub and takeaways. That is why keeping track of your expenses is extremely necessary. You can create graphs and tables in excel and do it manually or you can just use one of the hundred apps that exist in the internet to record your daily, weekly or monthly expenses.

5. Ways to save more money

• Consider cutting some non-essential purchases e.g. cigarettes, coffees, alcoholic beverages, takeaways, etc.
  
  
• Shopping in the evening – After about 7pm some supermarkets start reducing the prices on some item. It doesn’t mean they are not good; it just means that they are going to expire soon.
• Try to practice calisthenics workouts at home instead of going to the gym.
  
  
• Always compare and track prices before you buy something. Sainsbury’s and Tesco have good prices but consider checking Amazon or any other online shops.
  
  
• Try to use discount vouchers when ordering food or buying from online shops. There is always a way to find vouchers online for everything.
  
  
• Get yourself a loyalty card from the place where you do your groceries. You can claim money off with points e.g. Tesco Clubcard, Nectar card (Sainsbury’s) and Boots Advantage card.
  
  
• Only taking cash on nights out – This is a very old trick but should be mentioned. Make sure you only have £X to spend on that night out and that there is no way you can pay anything with your card/mobile after you spend all your cash.
  
  
• Never pay to withdraw cash – Try to avoid ATMs that charge you for withdraws. Unless it is an emergency, you should never use them.

Now it’s your turn for you to show yourself that you can save money! Once you get the routine going you will find your bank balance slowly increasing. You will eventually start caring more about the numbers in your bank account and to stress less about such a stressful issue.

Afonso