Student Budgeting Tips
Being a student at university or college will be one of the best times of your life, so you don’t want to be continually stressed about money, or be stuck at home because you don’t have enough funds for a night out with your new friends. Therefore, you need to know how to create a budget which will work for you as a student, because if you are able to create an accurate budget, you’re more likely to be able to stick to it.
1 Make an accurate and usable budget
If you start out with a realistic budget then you’ll save yourself time and stress because you can avoid going back over your budget because you’ve forgotten an expense, or underestimated a cost. Therefore, when you are entering your expenses overestimate them and round them up a little each time. This gives you a little extra breathing space if for example you go over your phone plan or you do a little extra driving and chew through more fuel.
To make sure your budget really is accurate and includes everything you spend, keep track of all of your expenses. This is as simple as holding onto the receipts for everything you buy, and entering these amounts into your budget. This allows you to track and allocate funds for everything you need – rather than just the things you can think of at the time you make your budget. Having an accurate budget will help you stick to that budget as you don’t have to make calculations on the go, and you know at every moment how much you have to spend, and on what.
2 Compile and review your budget monthly
Checking over your budget every month means you can see whether you really are keeping to your expected expenditures or whether there are still things you have forgotten to account for. Reviewing your budget you can see if there is a place where you regularly go off course and you may need to re-evaluate your other expenses to allow for it. For example, do you find you’re going over your phone plan each month and could find a better deal for your calls with another provider? Or maybe you’ve realised that you’re using your mobile phone all the time and don’t need to pay for a landline rental at all.
To make your budget even easier to review, compile it in an excel file which can be easily changed, not to mention it will do all the calculations for you. You can save a file for each month and this also allows you to look back on your spending habits to see where you could make changes.
3 Don’t forget the sporadic expenses
In making a monthly budget you will be able to account for things like rent and phone bills but you may forget about costs which occur six monthly or yearly. Therefore, make sure your budget includes expenses like car registration and insurance, dentist bills or driver’s license renewal. These expenses which don’t come around very regularly are often a blow to many budgets, but you will be prepared for when they come, and being prepared means you are more able to keep to your budget.
4 Create an emergency fund, and one just for fun
An important part of your budget as a student should be a savings plan. While it’s easy to spend as much as you earn when you are studying, it is important to remember that studying is just one part of the rest of your life and you’ll need to plan for your working life expenses too, plus all the things you want to do after college like buy a house, or travel, or get married, or buy a great new car.
To help you with your savings as a student, open an high interest savings account which has the feature to allow you to open several sub-accounts too. A high interest savings account is an online account which helps you easily and effectively save your money, without you noticing it’s even gone from your account. Opening a savings account with sub-accounts allows you to save for emergencies, nights out or holidays, the future, and those yearly expenses which can hit you hard. By directing some of your wages or study allowance into a high interest savings account and its sub-accounts, you’ll be able to keep on top of all your expenses now and into the future.
5 Part time work
As a student you may not have a lot of time to work, but this is perfect because working just enough to pay your bills and have some spending and saving money means you are likely to fall into a lower tax bracket, or you may even be able to avoid paying tax at all. Even if your parents have an education fund set aside for your expenses, or they send you an allowance, earning a wage on top of that means you can more easily set aside more money into your savings account, as well as keep to your budget.
Earning, saving and budgeting are important lessons you should learn on top of your studies, and learning them while you are a student will serve you for the rest of your life.
This is a guest post by Fred Schebesta who works for Savings Account Finder, where helps people to compare savings accounts and term deposits online.
