Surviving University - Budgeting

Today's post may be one of my most thrilling yet - it's on budgeting and finance...

I'll start by summing up the basics, all though you probably already know this.

Whilst you are at university, your expenditure will fall into three areas:

• Tuition fees
• Accommodation fees
• Living costs

For UK students, studying in the UK, there are three types of loan; it works differently for EU and International students. Scottish students studying in Scotland don't pay tuition fees, either.

• Tuition Fee Loan - This is paid directly to your university, and you don't have to worry about it. 
• Maintenance Loan - This is paid to you at the start of your term, and the amount you receive depends on your household income and whether you are living at home/away. Students in London receive a higher loan.
• Maintenance Grant - This is a sum of money given to students with a lower household income. A full table showing how much money you can receive can be found here.

For more information on loans and fees, this link will take you to the Government website. 

Repayment

All loans have to be repaid, but not at once! You only pay back:

• When your income is over £21,000 - and if your income drops below this, you stop repaying (until it goes up again!)
• With interest, but this depends on how much you are earning
• Monthly; the repayment rate is 9% of the portion of your income ABOVE £21,000 - so if you earn £25,000 pa, you pay back £30 a month. 
• and if you get stupidly rich, you're free to pay it all off at any time, of course...
• For a maximum of 30 years - after this, any outstanding debt is written off. 

It sounds like a lot of money, and a lot of debt, and this is worth considering when deciding if university is for you, or if you are going to take our a loan. However, the repayment scheme means that your university debt will never place you in an untenable financial position - if you can't pay, you don't pay! 

Budgeting

Looking after your finances at university isn't too difficult if you're organised, and keep track of what you're spending. Here are some tips for staying in control!

• Don't leave your student finance form until the last minute!
• Keep a budgeting spreadsheet. Make a note of what you spend, and how much you have left. Set yourself a weekly budget - mine is £80 - and try to stick to it. 
• Don't include any hypothetical jobs in your predictions - until you have a job, don't plan to spend the money from it...
• Don't divide your loan by 52 and spend that much each week. Set a weekly budget which will leave you some money left, if you can. This will be your fund for unexpected expenses, holidays, and savings. 
• Set up an online banking account! This allows you to check your balance, manage your accounts and transfer money from your bedroom. Talk to your bank if you don't have one.
• Debit cards are better than credit cards - you can't withdraw money you don't have on a debit card!
• Look into student accounts. You do not need to have one - I don't - but they do include things like an overdraft and included NUS extra membership, which you may want. Each bank/building society will offer a different deal, so check out more than one. ISA accounts offer good amounts of interest for long-term saving, and other accounts offer shorter term savings accounts: it is probably worth having a saving and a 'spending' account, if you haven't got these already. 
• Decide if you need an overdraft. This is a system which allows you to temporarily get out more money than you have in your account, without being charged extra. You do not need to have one, especially if you are careful not to overspend, but it's better to have one set up than to spend 20p over and face £20 fines. This may be useful to people who are paying larger sums from their main account, like accommodation fees, and so are likely to have lower sums in their account at any given time. 

Living within your means...

Everyone will have different financial circumstances, so the important thing is to make the decisions that are right for you. The best thing is to get into good habits. Doing big shops for longer life food, like pasta and rice, will save you money; top-up style shopping at the nearest Tesco's looks cheap, but the 'good' deals may tempt you into buying things you don't need, and buying more often than you need to. Stick to your shopping list! If you don't trust yourself, get cash out and leave your card at home...

One of the most important things about university is the social side, and it is worth investing money in the experience. Sports memberships, day trips and evenings out are, in my opinion, good uses of money - you are meant to live at university, not just survive. However, you can have just as good a time watching a movie in someone's room or messing around in the local park, so be creative! Bring and share picnics/meals are cheap and fun, and it's well worth exploring the parks and free places in your area. Look for student deals, films at odd times of day - you are a student, normal sleeping/eating hours are not obligatory - and society social events, which are often free or subsidised by the union. Having a good time doesn't have to be expensive!

Above all, don't worry. ALL universities offer support services, who will be on hand to help you through any problems you may have, answer your queries, or even offer emergency loans. Money can be stressful, but with a little planning and discipline, you will be fine! 

J.R. x