September is right around the corner, so naturally those of us who are students are anticipating the months ahead. Whether you are just starting your first year at University, or returning for another year of study, it is important to get your finances in check.
By now you will have applied for student finance and will have (hopefully) received confirmation of your funding. That means you can start budgeting! As soon as you know what your maintenance loan is for the year, you can begin budgeting to ensure that you make your money last throughout the year at University.
The best way to begin is to add up all of your income over the coming year. For instance, this could be from your maintenance loan, money from your job, money that your parents may send you, etc. As an example:
- £5,530 maintenance loan
- £300 from summer job
- £50 per week from a part-time job (£2,000 over 40 weeks of University)
- £20 per week from parents (£800 over 40 weeks of University)
- Grand Total = £8630 income over the year
Next, you need to add up all of your outgoings over the next year, including your rent for accommodation, phone bill, insurance, food etc. As an example:
- £4,600 Halls of Residence Rent
- £30 per week on food shopping (£1,200 over 40 weeks of University)
- £40 per month mobile phone bill (£360 over 40 weeks of University)
- £20 per month other bills (Netflix, Spotify, etc) (£180 over 40 weeks of University)
- Grand Total = £6,340
If you subtract your outgoings from your income (£8,630 – £6,340), you will be left with the money you’ll have to spend on ‘luxury’ items throughout your year at University. So for instance, if this were my actual income and outgoings, I would be left with £2,290 to spend on myself, on my social life, on necessities for my course (for example, stationery, books, printing credits in the University Library, etc).
This might sound like a lot of money – and it definitely is – but budgeting can help to prevent you from spending the majority of your money in your first few weeks of freedom. When you divide your leftover money (£2,290) by the time you’ll be spending at University (40 weeks), that only leaves you with £57 per week. Again, this still might sound like a lot of money, but without a budget you could be in danger of spending your weekly allowance on just one night out with your flatmates!
One of the key factors of budgeting is keeping track of where and how you’re spending your money each week. I found that most of the time, I hadn’t even realised that I was spending as much as I was – especially thanks to my contactless card! Small purchases add up. Grabbing a £3 coffee on your way to your lecture, a £3 meal deal for lunch, and a £3 bus fare back home, and before you know it you’ve already spent nearly 1/5 of your weekly budget. If you struggle to manage your money on a weekly basis, stay tuned in to my other posts for top tips on how to budget!