Managing finances is never easy, and it’s especially hard on a student budget, but as long as you’re careful and savvy, you can make sure you stay on track financially. This advice will hopefully mean you’re able to cut down on your spending, and increase your saving, so you can put some money towards whatever you’re saving for, be it a new car, a holiday, a new laptop…
The first important step towards cutting spending is to work out how much money you actually have. Sit down, think about where your money comes from, and write down how much you get, when it arrives, and from where. Examples of places you may receive money from includes Student Finance loans, bursaries, part-time jobs, or family support. If you’re not sure exactly how much money you’ll be receiving from somewhere, for example, if your hours at work vary, under-estimating will always leave you better off than over-estimating.
From here, decide how you want to break down your savings: termly or monthly are usually the best ways for students to manage their finances, but weekly may work better for you. To figure out which way might work best for you, look at how regularly you receive money and how regularly large payments such as your rent need to be paid, and decide which makes the most sense. I find that it’s easier to keep an eye on how much you’re spending if you focus on how much you can spend per month, else you may risk running out of money by the end of the term. This may be a bit of trial and error, and you can always adjust as you go along!
Once you know how much money you receive, be that monthly or termly, start taking off your regular, essential payments, such as the rent, bills, and essential shopping such as food and toiletries. Working out how much you spend on food, toiletries and other essentials like cleaning supplies may take some time and adjustment, but make sure you keep a record of what you spend to work out how much you need to set aside. Once you’ve taken these costs off, you’re (hopefully) left with some money you can spend or save as you like. Out of this amount, set a target for how much you want to save per month/term, and this will leave you with a figure of how much you have for spending on things like going out for meals/coffee, or buying yourself treats.
Now you’ve divided up your money, it’s important to track how much you’re spending, and how much you have left. I do this in a physical planner, but you can also do it digitally. Make a note of when you spend money, where you spend it, and how much it was, and keep an eye on how much you have left. Being aware of this can really help you cut down on non-essential spending: if you notice you’re spending £20 a week on coffee, try to cut down. Buy a flask and take a hot drink out with you to stop you from buying one every day, and apply this to other areas as well: be sensible with your grocery shop—don’t buy things you don’t need! Meal planning is your friend for this. Really think about whether you need that new jacket, or whether you’d rather put the money into a savings account to help you with your long-term goals.
At the end of the month/term, if you’ve spent less than you budgeted for, put the left over into your savings. Awareness and planning ahead really is the best way to manage money, even if it means taking a few hours to sit down and figure it all out, but if you take the time to budget, you’ll find you’re well on the way to saving for that once in a lifetime summer holiday with all your pals!