Essential university student skills: budget and money management

When loan payments go through, many university students find themselves in charge for the first time of a significant amount of income. Seeing a four-figure sum of money just sitting there in your account waiting to be spent can be an exciting and tantalising experience. And of course, there are endless things to buy! Tickets to student events, enrolment in clubs and societies, nights out, as well as shops filled with soft furnishings, tech buys and other impulse purchases… There is so much stuff you just need! Or do you…?

Managing money as a student can be a challenge. But it’s one you can rise above if you follow a few pointers. Our tips will help your funds go further and ensure money worries don’t keep you awake at night. That’s what exams are for…

Separate your wants from your needs

This may sound obvious, but it can be harder than it first sounds. You need to be honest with yourself and disciplined, if you’re going to truly benefit from establishing what things are “wants” and what are necessary. It’s a tough but vitally important skill for managing your limited student budget, and it’ll set you up for life.

What do you need, as a student? Accommodation is hopefully taken care of, so you need food and the necessary equipment to prepare it. You need enough clothes to last you a week between laundry cycles, towels and bed linen, a laptop, some textbooks, and any specialist equipment your course requires. Pretty much anything else is a “want”.

For many students, the first test of wants vs needs will arise before you ever arrive on campus and see your new digs for the first time. And worse, you may find that your parents – who are usually urging you to keep your spending in check – are suddenly encouraging you to buy up the entire shop. They’ll be anxious to ensure that you’ve got all the creature comforts you can possibly access as you move away from home for the first time – and this anxiety doesn’t always lead to sensible purchases. You and your loved ones should be particularly wary of filling your shopping trolley with the following:

• Crockery, cutlery, and pans. This applies no matter what your living arrangements will be – whether you’re going into catered halls or shared housing. Your kitchen facilities are almost certain to be shared with a minimum of five other people. No kitchen needs five full kitchens’ worth of stuff. If you’re able to find out what’s provided beforehand, make sure you do so. If you’re moving in with friends, coordinate with them so that you buy complementary items. And if neither of the above applies, wait! One trip to a large store with your new housemates and you’ll be able to acquire all the kitchen gadgetry you need, with the budget shared and with no duplications.
• Single-function kitchen gadgets. The miracle chopper, the garlic mincer and the sandwich toaster? Give them a miss. Chances are somebody you’re sharing with will have brought one anyway. And if you and your housemates decide you absolutely can’t do without a garlic mincer, well, then it’s a “need”, and you can buy it together.
• Technology. What if you don’t make friends right away? What if you need to pass time alone? How will you keep yourself entertained? These are all valid concerns and can lead to entire duplicate sets of tech being bought for uni. But the more tech you cram your room with, the less likely you are to leave it! A small, portable stereo with a Bluetooth player for your phone is probably a sound purchase if you don’t already own one. But do you need a flatscreen TV when you can watch Netflix perfectly well on your laptop or phone? And is that games console you’re eyeing really going to serve as the icebreaker you imagine, or will it just mean you’re less likely to wander down the corridor to see what your housemate’s up to? Remember, if you decide as a household that you need these items, you can club together and share the cost.
• Décor. Decorating your student digs can be done very cheaply, but it’s easy for costs to mount as you search for the perfect ambience. Lamps, bean bags, plants and even wall decorations can come at a premium. This is especially true if you buy them on impulse because you’ve seen them on display, or if you’re doing the big pre-university shop. Restrict yourself to buying these kinds of items online: that way you’ll have more time to reflect on whether you really need them, and will be able to shop around for deals.

Create a budget and stick to it!

Have you ever gone for weeks at a time without checking your bank account because you just don’t want to see what’s left in there – or more accurately, what’s gone? If your answer is yes, that’s OK. It’s a very common approach to money management. But you need to change things up if you’re going to handle your student finances effectively.

There are two things you need to know. First, exactly how much money you have coming in every month. Second, all the outgoings – rent, bills, car and home insurance, subscriptions, and so on – that are committed and that you simply have to pay every month, even when money’s tight.

After you’ve determined your disposable income for the month, divide it into sensible chunks to account for your spending categories. It’s important to be realistic here – don’t convince yourself you can get by on a social budget of £100 per month if you go out five nights a week. But also don’t spend money simply because it’s there! If, after allocating funds to all your activities, you find you’ve got money left over at the end of the month, that’s great news! Don’t simply adjust your spending upwards by drinking a couple more beers each Tuesday. If you save a little every month, you might just find you have enough for a week in the sun by the time summer rolls around.

Shop smart for (and sell) textbooks

Let’s face it: books are pretty nice things to own. And some textbooks are quite beautiful objects. There can be something very exciting about getting together shiny new copies of your module textbooks at the start of the term and flicking through them to see what’s in store for you. Previous students’ highlightings, underlinings and annotations can take the sheen off this otherwise pleasant experience.

But for the budget-conscious student, starting each term with a big pile of shrink-wrapped books with uncreased spines and new-paper smell is an unjustifiable luxury. With specialised textbooks often running at prices upwards of £50, book buying can be a serious drain on your cash.

Here’s how you can make sure your textbook budget goes as far as possible:

Don’t buy everything on the reading list

This is a rookie mistake that if you make even once in your first year, will likely be very costly. Sometimes at the start of a module, you’ll be given a very extensive reading list. It can be tempting to go pick up everything on the list – or even a selection of the items on it – and get stuck in. Don’t. If the list doesn’t make clear which books are and aren’t for purchase, wait and see. By all means, borrow a few from the library to get you started. Speaking of which…

The library is your friend

Look carefully at the module handbook and reading list before you decide what books you need to buy. Even if a book is listed as “to buy”, double-check how much you’ll really need it. Sometimes module tutors can be a bit over-eager. They’ll send their students scurrying off to the bookshop, even though photocopying a couple of relevant chapters from a borrowed copy might suffice just fine. If a book is used every single week – or a substantial number of lectures are based on it – you’ll probably need to purchase it. But if you only need it for a couple of weeks over the course of the term, hold off.

Shop used rather than new

Both online retailers and bookshops on or near campus are likely to offer very significant discounts compared with new prices. A few things to note, though:

1. Condition of the text. Pay attention to the condition of used books when you buy. You can live with dog-eared pages easily enough, but you might find that another student’s annotations on every single page are too distracting – and the price difference between an unmarked used book and a heavily annotated one is often minimal.
2. For the best book bargains, don’t just consider retailers. Look at the notice boards in your department before the start of term. Books you need may be for sale privately for a better price and in better condition than the resales in bookshops.
3. Consider editions. If you’re buying an edition other than the one listed in the module handbook, make sure you compare it to the listed edition. For creative texts like novels, you can probably live with a different edition, though it can be annoying to be flipping through your book to try to find the passage that’s on page 2 for everybody else. But textbooks in disciplines like law or the sciences can change radically between versions, and older editions could be missing entire sections or contain information that’s simply outdated or incorrect.

Sell your books – at the right time

Bookshops will often buy back your textbooks. But since they need to make a profit on the resale, you’ll likely only get a fraction of the price you paid. Advertising on departmental notice boards will get you the best deal as both a seller and a buyer: undercut the bookshop’s used price by £2 or £3, and you’ll still end up selling for more than the bookshop would have paid you!

If you’re planning to sell your books on, of course, it pays not to cover them in highlighter and notes. But the most important tip for reselling books is: don’t sell a book you might need to buy again!  Some books are considered fairly fundamental to a certain field or discipline, and you should find out if any of your books fall into this category before you sell them. No matter how good you are at bargaining, you inevitably lose money both when buying and selling second-hand books, so the last thing you want to be doing is re-buying books you’ve already sold.

Needless to say, if your course requires additional specialist materials – from lab coats to hard hats – much of the above applies to them too.

Do your homework on loans and financial aid

Perhaps the most important way to set yourself up properly for university is to make sure you know exactly what financial support you’re entitled to, and that you’ve applied for everything available to you.

Virtually all students take out a student loan from the government. These have a means-tested component, and how much you’re able to borrow will depend both on your financial circumstances and (especially if you’re applying to university straight from school or are under 21) those of your parents. The government provides a student finance calculator to help you work out how much you’re entitled to. To ensure you receive your full entitlement, get all the necessary information from your parents about their earnings.

Student loans aren’t the only source of financial support for students. A variety of supports are available for students in particular circumstances, including;

• Mature students (especially those with substantial pre-existing financial commitments)
• Care leavers
• Students who are also parents
• Disabled students
• Students experiencing housing issues or financial hardship.

The UK government provides guidance on some of the financial assistance you might be eligible for over and above your student loan.

Beyond this, you might want to consider applying directly to your institution for scholarships and bursaries. Universities – and individual departments – often run competitions for funding based on academic merit, need, or both. Many of these awards are quite small (£1000 or less) and require you to demonstrate academic excellence or commitment to your studies. Some are focused on students from particular groups – minority ethnic backgrounds, for example – while others are targeted at similar areas of need to those identified by government schemes, and you may need to demonstrate your eligibility.