University is a time for gaining your independence. Indeed, for many students, it’s the first time you’ll need to manage your finances. Learning how to budget is crucial for making your money last, avoiding debt, and reducing stress during your studies.
Why Budgeting Matters at University
University can be expensive, and your expenses might be higher than expected. From rent and bills to food, travel, and socialising, managing these costs is essential to ensure you don’t run out of money before the end of the term. A reasonable budget helps you:
- Track your spending.
- Avoid debt.
- Build good money habits for the future.
- Feel more in control of your finances.
The Essential Expenses that Need a Plan
To create a budget, start by listing your main expenses. Here’s an overview of the typical costs you’ll need to consider:
a) Tuition Fees
For most UK students, tuition fees will be covered by a Tuition Fee Loan, which is paid directly to your university. However, factor in this significant cost if you’re self-funding or partially covering your expenses.
b) Rent
Accommodation is likely to be your most significant expense. Whether you live in university halls or private accommodation, make sure you know the cost of rent and whether it includes utilities such as electricity, gas, and water.
- University Halls: Rent for student halls can vary, but depending on the location, expect to pay between £100 and £250 per week.
- Private Accommodation: Rent for shared housing or flats varies by city but could range from £80-£150 per week outside of London and significantly more within the capital.
c) Bills and Utilities
If your rent doesn’t include utilities, you’ll need to budget for additional bills, including:
- Electricity and Gas: Around £30-£50 per month.
- Water: Around £20-£30 per month.
- Internet: Usually £20-£30 per month, split between housemates.
d) Food and Groceries
Food shopping can add up, but there are ways to keep it manageable. Budget around £25-£40 per week for groceries, depending on whether you share meals or cook independently. Cooking at home and meal planning will help you stretch your food budget further.
e) Travel
Whether you need to travel to and from university or head home on weekends, transport is another cost to account for:
- Public Transport: Get a 16-25 Railcard to save 1/3 on train fares or a student bus pass for cheaper local travel.
- Cycling: A bike can save you money on transport, but don’t forget to budget for safety gear and maintenance.
- Driving: If you have a car, include insurance, fuel, and maintenance costs.
f) Study Materials
Textbooks, software, and other study materials can be pricey. Check if your university offers library textbook access and look for second-hand copies or digital versions—budget around £300-£500 per year for materials, which will vary by course.
g) Social Life and Entertainment
University is more than studying; you’ll want to budget for social activities such as eating out, going to the cinema, or attending events. Aim to set aside £30-£50 per week for entertainment, but adjust according to your priorities.
Income: Where Will Your Money Come From?
Once you’ve identified your expenses, it’s time to consider your income. For most students, this will come from a mix of:
a) Student Loan
Maintenance Loan: Helps with living costs and is paid in three instalments annually. The amount you receive depends on household income and where you live. For example, students living away from home (outside of London) can receive up to £9,978 per year.
b) Part-Time Job
Many students work part-time to supplement their income. Popular options include bar work, retail, or tutoring. Be sure to balance your work hours with your studies.
Be careful that your job doesn’t impact your studies. It’s easy to panic about money and forget why you attend university. You are investing in your future!
c) Scholarships and Bursaries
If you’re eligible for scholarships, bursaries, or grants, they can provide extra financial support that doesn’t need to be repaid. Check with your university’s financial aid office to see what’s available.
d) Parental Support
Some students receive additional support from parents or guardians. If this applies to you, include any regular contributions in your budget.
Creating a Budget
Now that you know your income and expenses, creating a budget is time. Here’s how:
Step 1: Calculate Your Total Income
Start by working out how much money you’ll have for each term. Add up your maintenance loan, part-time job income, and any contributions from parents or scholarships.
Step 2: Break Down Your Expenses
List all your essential expenses (rent, bills, food, etc.), then allocate a portion of your income to each category. Make sure your total expenses don’t exceed your total income. Here’s a sample breakdown:
- Rent: £450 per month
- Bills (utilities, internet): £50 per month
- Food: £160 per month
- Travel: £40 per month
- Study materials: £30 per month
- Social activities: £100 per month
Step 3: Track Your Spending
Use Blackbullion’s Money Manager app to track your spending in real time. The app allows you to categorise your purchases and see how much you have left in each part of your budget.
Step 4: Adjust as Needed
You’ll likely need to tweak your budget each month. If you’re spending more on socialising, see if you can reduce non-essential expenses like takeaways or subscriptions.
Money-Saving Tips
Managing a budget at university can be challenging, but with some innovative strategies, you can make your money go further:
a) Use Student Discounts
Take advantage of the many student discounts for shopping, dining, and entertainment. Sign up for TOTUM, Unidays, and Student Beans for discounts from major retailers and service providers.
b) Shop Smart
- Bulk Buy: Buying non-perishable items like pasta and rice in bulk can save you money in the long run.
- Meal Plan: Plan your weekly meals to avoid impulse buys or unnecessary takeaways. Cooking in bulk and freezing meals is also a great way to reduce waste.
- Supermarket Offers: Shop during sales, use discount apps like Too Good To Go, and consider shopping at budget supermarkets like Aldi or Lidl.
c) Save on Travel
Use public transport discounts, such as a 16-25 Railcard for train travel or a Student Oyster card if you’re in London. Cycling or walking where possible can also save money and keep you active.
d) Share Costs
If you live with others, split the cost of household items, bills, and groceries to save money.
e) Avoid Unnecessary Debt
While using a credit card or payday loan can be tempting, avoid high-interest borrowing. Stick to your budget and only borrow money if necessary.
What to Do If You Run Into Financial Trouble
Unexpected expenses can pop up, and if you find yourself struggling, don’t panic. There are options available:
- University Hardship Funds: Most universities have funds for students with financial difficulty. Contact your Student Services for advice on how to apply.
- Student Finance Advisors: Speak to a finance advisor at your university for help managing your budget or finding additional support.
- Part-Time Work: If your studies allow, consider working extra hours part-time.
Final Thoughts
Managing your budget at university may feel challenging at first, but with the proper planning and tools, you’ll be able to keep your finances under control. Track your spending, be mindful of your income, and remember that there’s plenty of support available if you need it. By sticking to your budget, you can enjoy your time at university without the stress of money worries. You’ve got this!
