The complete student budgeting guide
Anxious about getting through uni on next to no income, or just keen to learn how to make your student loan stretch further? You're in the right place!
1 in 5 of you revealed to us in our Student Money Survey this year that you’ve never budgeted before in your lives, so we figured it's probably time we show you how it's done!
We're not gonna lie to you – it won't always be fun ‘n' games when you're cutting out your precious daily Starbucks order and walking to uni in the rain to save on bus fair, but once you get in the black, you won’t want to go back. Trust us.
Once you’ve nailed the whole budgeting thing, you’ll be way more clued-up about how to make your money go further and be able to spot cash spoilers a mile off – even once you're earning a neat buck in your graduate job.
So listen up, and consider the next 20 minutes you spend reading this article as a lifetime investment!
What’s on this page?
Work out incomings and outgoings
Your basic budget is as simple as listing all the money you’ve got coming in, tracking how much you spend, and seeing whether they balance out.
You can sketch it out on paper, on your phone or try to do the maths in your head – but to keep things sweet and simple, we've put together a handy student budget sheet that does the hard work for you.
How to use the budget spreadsheet
To use the spreadsheet, just enter any money you have coming in each month (for example your student loan, salary from a part-time job, or some cash you're rents offer to help with uni costs) and keep a log of your expenses in the below section (like clothes, rent, books and going out). The spreadsheet will then do the calculations for you and track whether you’re living within your means each month.
You can budget as you go, but it’s also a great tool if you’re working out whether your finances are going to fit your future spending – such as planning for the uni year, if you can afford a holiday during summer, etc.
The aim of the game is to keep your balance (the money that’s left over after you’ve accounted for spending) in the black – and ideally have a few quid left over each month to squirrel away or treat yourself with.
If you find you’re overspending – or it looks as though your budget won’t match your expectations – you’ll need to find ways to bring it back in line.
Keep track of where your money goes
Credit: Johan Larsson – Flickr.com
Once you start snooping regularly on your expenses, you’ll quickly see there’s more to your spending than rent, food and stationery. It's important to know that this is the key to being a pro budgeter – the more you check what's going on with your balance, the more in control you'll be of your financial situation.
Just how obsessive you get about logging your spends is entirely up to you – but knowing exactly where your money goes gives you more control over how much you bust, and has a huge affect on how you manage the decision process when parting with cash.
Once the realisation sinks in that you’re flittering away a tenner each week on late library book fines and overpriced coffee, you’ll be prepped to get your books back on time… and maybe buy a thermos!
Credit: Andrew Blight – Flickr.com
Whether you’re happily in the black or further in the red than you'd even like to admit to yourself, your budget can always benefit from a boost.
There are two obvious ways to do this: increase your income, or decrease your spending. Simple, right?
Well, this sounds a lot more simple than it is in practice. Increasing your income tends to be harder (if it wasn't, you wouldn't be reading this guide!) but it’s not just about getting a job, demanding a pay rise or hocking your prized comic collection.
You can also try out a few of these hacks for generating a small passive income – you won't see your bank balance shoot up immediately, but over time you'll start to see a profit.
It’s worth checking your budget once a month to see where you over-spend, or if any of your fixed outgoings like rent or bills can be cheaper (if you reckon you can get a better deal elsewhere, switch those babies up!).
Cut some costs
Credit: Christian Schnettelker – manoftaste.de
Cutting costs is a doddle (in theory!, but you'll need to stay motivated and work on that solid steel willpower to make it work!
There are loads of everyday money-draining monsters out there preying on unsuspecting students, and it would do wonders for your bank balance if you cut them out completely.
There are of course other expenses that you can probably cut back on but can’t do without altogether, like… eating, perhaps? You can, however, save a load of cash in the long run just by being a bit more aware of how you spend your pennies.
Luckily for you, this is our area of expertise! Check out our list of guides on saving cash – we can guarantee there will be tips and tricks in there beyond your wildest budgeting dreams.
You can also sign up to our weekly newsletter that includes a round-up of the top 20 deals available to students.
So now you've got your budget all set up and ready to rock, here's a few practical savings steps to help you get off to a rolling start!
- Ask yourself: do you want this, or need it? Spend your money on the stuff you need first, and save the ‘wants' for special occasions.
- Give yourself a set allowance for each of your spending areas, such as going out or food shopping – and stick to it. If at the end of the month you've underspent in one area, you can carry that over to the next month, or use it to supplement your budget in another area for that month. Shopping trip!
- If you really struggle to track daily spending, take a set amount of cash out at the start of the week and use that instead of paying by card. It’s an easy way to see exactly how much you’re spending, with no hidden interest charges to boot.
- Get into the habit of planning your activities around what you can afford, instead of fudging the budget for big spends like festivals and holidays, etc.
- If you can manage it, always siphon off some of your income at the start of the month and put it into a savings account or ISA. If you make it to the end of the month with cash to spare, squirrel that away for a longer-term spend instead of blowing it on a quick fix.
- Recycle everything. If you’re done with something, and it's still usable – sell it on for cash or swap it for something else. Likewise, never buy new if you can get it just as good from someone else for less cash. This works for clothes, furniture, textbooks, you name it.
- Never stick with your bank account just to be loyal – loyalty doesn't pay in this game! And some banks will even give you a cash incentive to switch.
- Open a second bank account for any lump sums you receive (maybe your loan, grant, or some inheritance money perhaps) and set up a direct debit so it drip-feeds into your current account in small doses. This way, you won't go crazy on the spending when a chunk of cash comes in, but you'll still benefit from a little bit of extra cash each month.
- Planning ahead does wonders to your bank balance. This applies to weekly meals, nights out and even the odd occasion when you decide to eat out. Sure, spontaneity is the spice of life, but it doesn't always work well when you're trying to budget. Try to know what you're doing and when as much as possible so you can plan ahead and budget accordingly.
- That said, don’t live like a monk 24/7. It's important to still have fun and do the things you love! Just plan ahead for splurges so you're never left with any nasty surprises on your bank statement.
- Be your own person. Don’t concern yourself with how much money your friends are making or spending – just stick to your own budget and keep your eyes on the prize. It'll pay off eventually, promise!
Now it's over to you! This all probably sounds a lot scarier than it actually is – once you get into the swing of things you'll find watching your bank balance slowly increase weirdly addictive, and you'll eventually stop caring about splashing out on luxuries every other day. Just think how sweeter they'll taste when it's time to treat yourself!
Got any budgeting tips to share? We want to hear 'em! Share in the comments section below, or drop us a line.