Pros and cons of student budgets
Not having a student budget can leave you in an abundance of funds, or a lack of – and sadly, the latter is more likely.
Pros of having a student budget
• Reduced financial stress – you may have reduced worries as money won’t always be on the mind
• Improved academic performance – by knowing where your money goes, you’re less likely to be stressed about unexpected outgoings
• Fewer lifestyle restrictions – by seeing what surplus you have, you can invest the money into something you enjoy
• Develops life-long financial skill building – By having healthy financial habits now can really prepare you for the future
Cons of having student budget
• Difficulty affording unexpected costs: Unexpected expenses, like a laptop repair or an impromptu trip home, can throw a spanner in a tightly planned budget – particularly if you don’t have an emergency fund in place.
• Increased financial risk if budgeting isn’t done right: If a budget isn't realistic or is hard to stick to, it can lead to increased financial anxiety and a sense of failure, which can negatively impact mental health and academic performance.
• Requires discipline and effort: Creating and sticking to a budget requires discipline, which can be challenging amid the pressures of university life and newfound independence.
How to make your own student budget
There are different ways to budget – and some methods simply wont work for everyone. It’s all about finding what works for you and your personal circumstances. Here are some starting points to help you make your own student budget:
Choose where to make your budget
Whether you love spreadsheets, your phone’s native notes app or good old pen and paper, choose a place to make your budget that you’re comfortable with. A digitised version is usually recommended for easy access and editing where needed, but choose what works best for you!
Write down all your monthly income
List the money you have coming in each month. This might include what we’ve already mentioned, but you may also have the following you wish to add any additional income you get from family, freelance work or scholarship.
Write down all your expenses
It’s time to get real about where your money goes. Break down your outgoings into two main pots:
• Essentials: Rent, bills, travel, and study materials. This is the stuff you absolutely must account for.
• Nice-to-haves: Social life, hobbies, snacks, and nights out. This is where you can make cuts if needed.
Can't remember spending that much on a night out? Use your bank statements, apps, and receipts to check. Tally it all up, and that's your total monthly spending.
Discover what expenses can be reduced or cut altogether
Do you really need Disney+ when you spend most of your time on Netflix anyway? Use your budget to see where your money is going and cut off any unnecessary expenses. Yes, that includes the gym membership you had every good intention of using!
Keep your budget balanced
Take your expenses away from your income – are you left with more than you thought? Great! Some of it can be used in savings while the rest can be used for whatever you feel like.
Unbalanced? Not to worry, there’s help for that too.
Financial concerns
The cost of living in the UK has gone up exponentially, and it may have you going overbudget, even when you don’t intend to.
Start by reviewing your essentials. Is a music subscription absolutely essential right now? It’s also worth looking at other areas you may think are essential but really aren’t:
• A car – maintenance, MOT, fuel, it’s all a big expense for a student. If you are able to, consider lower cost options like public transport.
• Ready meals – we get it, cooking can be hard (to begin with!). By learning a few simple recipes you can batch-cook and heat up when needed, you can hit some serious savings
• Brand switch – We all have brands we rely on, but in the interim, it’s worth exploring unbranded/cheaper options
If you’ve checked for all possible unnecessary expenses and still have more essential costs than you have money coming in, make an appointment to speak to someone at your university or ask for details on your institutions Student Assistance Programme.
Many universities have support funds for students who experience financial hardship and can provide you with expert advice to tackle money worries.
