Students will normally find that they are short of money. This is because the student loan is not much money and students will also be unlikely to earn very much, if anything, while they are studying. Unless they are doing an apprenticeship degree, which will allow them to be paid, or they have a part-time job that pays well, they will need to be used to being frugal. However, having suddenly been given a big lump sum of money, it can be difficult to hold back on spending. However, there are some things that could help.
Calculate Weekly Budget
It is a good idea to work out how much money you will get over the year and take out big amounts you will need to spend such as rent and bus/train tickets. Then you will know what you will have left. Divide this by the weeks in the year and you will be able to work out how much you can spend in a week and this will help with being able to make sure that you do not understand. It can be worth actually setting a lower budget than you can afford because this will allow you to have a bit of extra money in case you need it for emergencies. You may also not need money in the holidays if you visit parents and they pay for everything. However, by calculating a budget for every week, you will be sure to have enough money left for everything that you need over the year.
Parents Give Money
It is worth noting that the maintenance loan is means tested and this means that if parents are earning well, they are expected to give the students money as how much you get depends on the household income that you live in during holiday time. Students may have to explain this to their parents and ask them for help and many parents will help out like this. However, there are some that will not and so this can make budgeting very difficult because there will be far less money available. Obviously, you will still be able to calculate how much money you have available to spend each week, but it might just not be enough. There might be bursaries available in this circumstance from the university but it may be necessary for you to do some part time work to support yourself or work in the holidays. It is a good idea to be completely aware of how much money you will have and how much you are likely to spend so that you can budget really carefully in this situation.
Keep Spending Down
It is important to make sure that you know what is necessary for you to buy and what is a luxury. Keeping spending to just necessities will make a big difference to how much you are spending and make it much easier for you to be able to stick to your budget. You will therefore need to think about this. You will need to pay your rent and for any bills you are responsible for. Often utilities are included in the rent but you will find that there may still be some things you have to pay for such as your mobile phone and you will need to pay for food, travel and study aids. There will also be medication and dentist bills to pay and then toiletries and cleaning products and you may need clothing. It can be good to ask family and friends, if they ask what you want, to give you clothing, toiletries and make up, for gifts, so that you are able to save money. Make sure you ask yourself whether you really need the items that you are buying and then only buy things that you really need. Try to make things last, such as clothing, so that you can delay buying new things until you finish your course.
Keep a Savings Account
It can be a good idea to have a savings account as well as a current account. Keep the bulk of the money you have in the savings account and set up a weekly transfer of your budgeted amount into the current account. This will make it much harder to spend more than you have budgeted to. Another way is to draw out cash each week and just spend that cash, although if you are buying online, then you will not be able to use cash, so this may not work for everyone. It is still good to have a savings account as it will pay some interest and this will be better than nothing, which is the amount you get in a current account. Do compare though as you may find that there are some student accounts that are worth getting. A savings account will also allow you to be able to keep some money tucked away for emergencies, which will give you peace of mind and be very useful too.
Keep a Constant Check
It is so important to keep a constant check on the amount of money that you have and whether you are spending more than you can afford. It can be worth doing this near to holidays as it may be that you will be able to get some temporary work to boost your funds. You will be able to plan this in advance if you know what your financial situation is and this will enable you to apply for things early as lots of students may be looking for work in the holidays so you will have to get in early if you want something. You might also be able to adjust your spending so that you are spending less as well, to make sure that you get back on track and do not run out of money before your next loan payment is due.