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Heading to University? 9 Money Tips to Manage Your Finances

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Are you heading to university this autumn? Nine money tips just for you! 

University is often the first time any of us are truly financially independent and responsible. It’s very easy to see your student loan come in and get excited (for many people this can be the first time they get a big sum of money) but it’s important to remember that it needs to last you the entire semester/term.

Whether you’re living at home, in halls or studying abroad there can be a lot of costs associated with studying so it’s important to manage your money from the beginning (and stay out of your overdraft). Here are nine top tips to help you make the most of your money whilst at university:

1. Learn what things cost

You may already know about the cost of basic things like a pint of milk, a pack of sausages, house cleaning stuff; or you may not. If you don’t know, now is the time to learn. You need to know the cost of these things so you can decide what to spend your money on and what not to; to decide if you will cook food or eat out; to decide how much you want to spend socializing; to decide what you will spend on clothes; to decide what stores you will shop at. 

2. Make a budget and STICK to it

Think of a budget as a money plan – what money you expect to come in and what you expect will go out. Start with the coming in. Assume you have a set amount of money coming in as mentioned above. If it’s a lump sum, figure out how many months or weeks that has to last and set out a monthly/weekly amount you can spend. Per Money Week, ‘one in ten students will blow their entire student loans within their first two weeks of uni… half will spend the lot before the end of the first term.’  Don’t let that be you!

Next focus on what you will spend, the going out money. Think about what you think you will spend on eating – cooking in is less expensive than eating out and over time you may decide to share the cooking and expense with others you live with. Think about socializing and how much you want to spend on going out. What about clothes? Sporting equipment? Travel? Books for your course? Set an amount per month on each of your big spending areas.  Then put your planned amounts in a spreadsheet. You can do this manually or use apps like moneydashboard or ontrees to automatically classify each expense and populate your spreadsheet.  Each month compare what you actually spent by category to your estimates (your bank or an additional tech app that draws information from your bank will help you capture the data). Then adjust the budget figures each month. You will get the hang of this quickly.

Of course, this is only useful if you stick to the budget in total. If you don’t you will soon run out of money and be eating a lot of toast and butter at the end of each month!

3Use your Debit card and AVOID getting lots of credit cards and overdrafts

Assuming you have a bank account you will have a debit card. Remember that when you use that card to pay for something, the money comes out of your bank account immediately.  An entry will be made on your bank account so that will be a key record of where your money is going. You will be approached by other banks, offering you credit cards and overdrafts. Approach these with great care… I have had way too many people tell me that they got into huge debt problems that took them years to sort out because during uni they took up credit card offers of ‘free credit’ and were unable to pay off what they owed. Their situation got even worse when the ‘free credit’ started to attract interest, increasing the debt further. Similarly, they took on overdrafts that were offered free of interest but which became interest bearing post uni. Avoid getting store cards as well – they are just another credit card.

4. Discuss money with your friends

Encourage open discussion about money matters with friends, recognising you are all in different financial situations. That means speaking up about when you can and cannot afford to do something and being supportive of others doing the same. If you want to take a holiday together talk early about how much you can each afford. If you share a house with friends discuss what you can afford as a monthly rental, whether you will cook as a group and how you will keep the place clean. If you share a house consider setting up a house account that everyone puts money into and someone controls what is spent.

5. Take advantage of student discounts

Many shops offer student discounts so ask about them wherever you shop during the uni term and throughout the year. You can also get discount rates to theatres, art galleries, and other cultural events. Even if you don’t see a notice in a shop, ask if there is a student discount – you will be surprised how many firms offer this. Get a National Student Union Extra card which offers deep discounts (Superdrug, National Express etc) and costs £12 or join unidays.com to get even more discounts. Check out what your own Student Union has to offer in terms of deals with local shops and events.  And finally, look for free stuff to do – there are tons of things to do that cost nothing you just need to seek them out.

6. Technology is your friend

There are many ways technology can help you manage your money:

  • Automatically transfer (direct debit) your monthly spending money from your main bank account into a new one. When that monthly money is gone you are done spending. Some of the new banks have great apps to provide instant information about what you have spent money on. Monzo and Starling are the ones I hear about most often.

  • Do as above for a household spending account once you move out of university halls. If you use this or not consider using the acasa app that enables you to split household bills amongst housemates.

  • Use automatic bill splitting apps when you are out with friends or go on a group holiday – Splitwise, Square, Splitoo, and Settleup.

  • Anytime you are buying anything of size search the internet – flights, trains, clothes.

7. Be Technology Safe

You don’t want to lose any of your money due to lax technology safety! Follow these basic security steps to be protected: Never share your pin number or password with anyone. Set a robust, complicated password – most hackers can break through passwords with ease so make their lives difficult. Back up anything of value – your course work, photos etc. Do not open emails from unknown sources, click on links embedded within an email, or speak to anyone from your bank/any bank that contacts you directly – always ring the bank yourself. It seems obvious but can save you a lot of hassle.

8. Consider getting a part-time job during term time

Many people have told me after they have graduated, that they wish they had worked while they were at uni. With hindsight they figured the money would have made life easier, they would have been more disciplined about how they spent their study time, and they would have spent less money as they would have been busier.  And if you can’t make working work during term time, organize paid work of some sort during holidays to reduce financial pressures during the school year.

9. Finally, do focus on your academic results, even in the first year of uni

Despite what you may hear your first-year academic results will be important when you look for summer internships at the end of your first and second years. You are investing a lot of money on your university education so make it worth your while Aim to get the academic results you want – whilst still enjoying your time!

These are just a few things you can do to get started with your money management. For more practical tips and advice about your money check-out my new book Your Money 2019-20.