Managing your money (now closed)

Student Money Week 2017

Worried about how you'll manage your money while you're studying. Warren Evans is here to answer your questions.

Advisor for this Q&A

Warren Evans, Welfare Advisor

Warren is the lead on Welfare and Student Finance at Bournville College. He had worked in various agencies across 15 years and had an interest in financial literacy.

Reply 1

username1050473

I'm planning on studying in London, and my maintenance loan (+ grant) is estimated at about £8k. The cost of halls alone will set me back about £6500-£7000 over the year. So, how much roughly would other things cost over the year (food, course books, etc. combined), and is a part time job the best way of covering all this?

Reply 2

colourful lamb

I'm a little bit unsure about how much people at University spend on food, going out, hobbies etc. It would be good to have a rough idea perhaps of what some people at University spend. Perhaps there are some resources/websites you'd recommend that advise students of this?

Thanks!

Reply 3

Sazzy890

You hear of lots of people that seem to get carried away when their student loan comes in (i.e. blowing it all when you first get it) - usually because they're not used to having so much to spend and living away from home for the first time.

Do you cone across this much, and is there anything that people that aren't so great at budgeting can use to realise they need to be a little more careful with that money?

Reply 4

iloverockandroll

Do you have any tips for anyone struggling for money at uni? Sometimes those with parents that own a good salary are deemed to have more money, but in reality the family doesn't actually have the disposable income to support them, therefore they find money tight. Any suggestions to make the most of their money and support themselves?

Reply 5

Warren Evans

Original post by sarcasmrules

Hi Sarcasmrules,

I'd usually expect a person to spend between 70-80% of their annual income on rent. Being in London may skew that for you slightly, as costs in London are so high.

How much your other costs will be depend greatly on yourself, and personal choices you make. For example, can you reduce travel costs by walking, or cycling? Can you happily substitute branded foods for non-branded foods. Can you keep the costs of books down by purchasing copies of last years books from the now 2nd years?

In order to maximise your income, there's a few things I'd suggest. Speak with the student services team at your university of choice - there may be additional bursaries/funding you can apply for. In addition, look to maximise the money you do have, rather than using expensive forms of credit.

To give you the most control over having an income, I'd say yes, p-t work would help, & employers in the future will like the fact you've real world experience too!

Reply 6

username1050473

Original post by Warren Evans

Thanks so much! I'm not picky about branded foods and I can easily travel by foot to various places, so this has eased my worries substantially. Thanks :smile:

Reply 7

Warren Evans

Original post by benthelamb

Hi Benthelamb,

a lot of what you ask is driven by personal choice. & to be honest, it should be, as the person is the one who has to live with the decision, & ultimately be satisfied with the diet they're on!

Some items will be more expensive than others - for example, meat.

I'd say an average adult can vary between spending £15 up to £30 per week on food. It is then about how you manage that.

My tips would be look at how you consume items. Avoid waste. Don't stockpile perishable goods like too much bread (unless you have a freezer), but it's ok to have larger stocks of items like pasta, or rice which you can store for longer periods.

Be choosy in how you buy stuff. Food isn't just fuel, it has to be enjoyed too.

Don't just go for convenience.

If you are in shared houses, a good way to reduce costs, and also try new things is sharing the shopping and the cooking. You're likely to get a few bargains when you bulk buy, so if 8 of you share 1 big meal, you can keep the costs down in a big way.

One other thing, food shopping isn't just the weekly shop. How many times might you pop out for milk, cheese, tea bags or similar. This is a cost too. Avoid paying over the odds by planning your shopping so you don't run out, as such items will be more expensive in the off licence which is open late!

Reply 8

Warren Evans

Original post by benthelamb

On hobbies - these are very important. It is important to manage them, as we all need a life outside of our studies. To this end, work out in advance how much this will cost you annually, eg how much is the membership? If you have planned this cost/expenditure, and it isn't a surprise, there's no reason why you can't keep it up!

Reply 9

Warren Evans

Original post by Sazzy890

Hi sazzy890,

This is very much a personal opinion, but there are lots of factors.
For many, being away from home & the shackles of parents rules for the first time has an impact. People want to express their freedom. Sometimes they go too far. In addition, peer pressure and wanting to impress new found friends can impact on this.

Secondly, moving to a new city, living on your own, and having your own responsibility(ies) is a massive step. Sometimes students have never had to manage their own money before. Therefore it is a huge step for them to take, and possibly - through no real fault of their own, they don't have the appropriate skills to budget.

Finally, I think getting such a large lump sum (with SFE payments being termly) can lead to some more naive or impressionable people spending money quicker than it arrives.

I think more planning needs to be done to support new students on personal budgets. I am very happy Martin Lewis successfully campaigned to get financial literacy on the national curriculum for 11-16 year olds, but worry about how that affects the missing 16-18 year olds, and also academies etc which do not have to follow the national curriculum.

Reply 10

Warren Evans

Original post by Sazzy890

Regarding how to manage, I'm afraid the answer is quite boring!
People need to do a plan or budget for themselves. A good example is here:
http://budgetbuilder.themoneycharity.org.uk/

However you can simplify this to a pair of scales. There has to be balance. On one side of a sheet of paper, not all the money you have coming in. On the other, list first your essential expenditure, such as rent, food, travel, tv licence, etc. That's your survival sorted. The remainder can be spent on choices, such as mobile phone, internet/broadband, nights out, cosmetics and so on.

Sometimes it isn't until we're confronted with the reality of how much we have to spend that we start to properly contemplate these decisions we're making, and the value some of these goods and services have for us.

Reply 11

Warren Evans

Original post by iloverockandroll

Hi Iloverockandroll

First off, you need to maximise your income. Speak to the student services where you're studying. They can make sure you're getting the appropriate level of student finance.
They can then support you with seeing if there are any bursaries available within the university you may be entitled too. Universities do have access to such funds. And in addition, there may be Access to Learning Funds that can help you.

In addition to the above, make sure you are claiming your council tax exemption.

Without knowing your personal circumstances (not appropriate for online) it may be in your interest to have a full benefits check, especially if you have children or a disability.

Getting a part time job (easier said than done I know) is a key option, as you can control your incomings better, plus, whilst working, you're not spending!

Then I'd be suggesting looking at making what money you have go as far as possible, and if possible work for you a little. In example, most current accounts give better interest rates than savings accounts nowadays. Can you use a current account to give you a return of up to £10 a month? Great oaks grow from little acorns!

Reply 12

Warren Evans

Original post by sarcasmrules

Thanks so much! I'm not picky about branded foods and I can easily travel by foot to various places, so this has eased my worries substantially. Thanks :smile:

You're very welcome!

As I mention in another post, make a list of your essential expenditure first. Then a second list of expenditure you'd choose to make. Essentially, what do you need, and then what do you want.

With some of the wants, you may realise that you can't have them all. So then you choose which you're willing to go without.

It's also ok to reward yourself every now and again too don't forget! In example, you saved £10 on a taxi fare by walking home. Therefore you're allowed dessert after dinner (that you made yourself!)

Reply 13

Warren Evans

Another tip I'd throw out there, is to ask how many of you know how much you spend currently?

Most people don't know their spending habits.

I challenge TSR users to spend a week, or even a fortnight where they write down everything they spend. Every penny. At the end of the week/fortnight, review that, to see whether you spent more than you thought, less than you thought, or about as much as you thought. The answer may be surprising.

It can also help you plan future spending, as you can then look at how much you've spent on some items, & raise your own awareness of where you over-pay. In addition, you may also realise that not all your expenditure is necessary.

Reply 14

Warren Evans

Another tip is the money jar. Some people have 1p or 2p jars. Personally, I think they're pointless. Great big jars, and you count up the coins when you eventually fill them, & there's £6 in them. Big whoop!

Instead, get a smarties tube. If you fill a smarties tube with each 20p you get, when full, that's a tenner! Which saves a trip to the bank.

A more interesting challenge is with £2 coins. Get a small piggy bank. You don't get too many £2 coins, so each one you get is deposited in there. If you manage this over a year - start january 1st for example, you'll find you'll save enough to pay for christmas! That way, you don't have a nasty shock.

Reply 15

Warren Evans

Here's Martin Lewis' 50 tips for stretching your student loan:
http://www.moneysavingexpert.com/students/student-guide

Reply 16

Warren Evans

I'd also say that choosing your student bank account carefully is important. Studies show graduates stay with their bank long after graduation. Undergraduates are therefore worth a lot of money to banks, & they'll try hard to sign you up.

Make sure your student account suits your needs. The banks will offer a shiny toy as an incentive to sign you up, but is that going to help you at university, or help you with your degree? Not necessarily.

Remember to read the Terms & Conditions of any account carefully. Pick out the account that best meets your needs, and offers more support, with less charges.
And bear in mind how the overdraft facility will change on graduation.

Choose wisely:
http://www.moneysavingexpert.com/students/Student-bank-account

Reply 17

Clare SFE

Official Rep