Student season: budgeting, overdrafts, insurance and earning extra cash

Iona Bain

Your exam results are finally through and depending on how they turned out, you may be on top of the world…or coming back to earth with a bump.

Whichever way, you are probably at a big crossroads right now. Are you going to uni or do you need a plan B? Are you taking time out or throwing yourself into the world of work? Do you want to live abroad for a while, or would you be happy to stay a bit longer in the free bed and breakfast known as your Mum and Dad’s place?

The decision is yours. But one thing’s for certain; if you have financial savviness on your side, you will be able to cope, whatever the future holds.

Now is a great time to learn how to make a monthly budget. This is can be as simple as an A4 page with two columns. One column lists all your outgoings per month, valuing each bill and area of expense, and the other column values all your income (earnings, bursaries, maintenance loans etc). The name of the game is for your income to surpass your outgoings. Simple, in theory! If you have a regular amount of money coming in via a wage or a student loan, set up a direct debit, essentially an automatic payment, for your basic bills after the bulk is paid; these always have to be paid as they are classed as “priority debts”. Then divide all your expenses into different categories under the headings “essential” and “non-essential” categories. Ask yourself whether you can cut essential costs (Can you use coupons and plan specific meals using a core number of ingredients? Travel off peak? Use a cheaper shampoo/mobile phone provider/barber?) Then ask what you can cut altogether (Do I need a new dress every week? Do I need to be drinking every night?”)

If you’re heading to uni, shop around for the best possible student account; forget the silly freebies offered by banks and concentrate on getting a decent interest-free overdraft. This will allow you to borrow if need be without paying for the privilege. Of course, you want to stay out of your overdraft as much as possible to ease your passage into the real world after graduation (graduate overdrafts are more stingy and end very quickly!) Insurance also makes sense, particularly if you have valuable tech or musical instruments, but read the T&Cs to check if your possessions are actually covered and under what circumstances you can claim. Poor security could make any claim invalid, so lock up valuable stuff when you go out and never leave your door open. To earn extra cash at uni, I worked for a short while as an usher at a concert venue. But many part-time jobs clash with studying so hunt down ad-hoc work, such as participating in paid experiments, and ones that will actually boost your CV, such as tutoring and taking work placements in the summer holidays (don’t be afraid to consult the careers advice department for pointers).  Many professional organisations, such as Women in the City and the Royal Television Society, offer free membership for students that could lead to priceless networking opportunities. Take advantage!

NOT going to uni? Check out the blog next week for tips on how to cope financially…

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