• Savvy students

    Our student guide is packed full of practical advice for making the most of your money on a student budget.


  • As a student, a great way to control your finances is to get as much advice and support as possible. Of course, that means talking money and bank accounts, but it also means looking at your lifestyle, too.

    There are so many different bank accounts and financial products available that it can be difficult to know the best one to pick when you're a student. Here are some things you should look out for:

    Student bank accounts:  These bank accounts are specifically designed for students, so often include an interest-free overdraft. They also commonly include freebies and/or discounts which can be beneficial but don't let these cloud your judgment and remember to review all of the elements of the accounts.

    Credit cards:  These can be a convenient way to manage your money when used appropriately. They can also help spread the cost of expensive items. There's usually an interest free period, so if you can pay them off every month, that's great, if not make sure you check the charges and don't forget that interest is charged on your entire balance if you don't pay the full amount off.

    Overdrafts:  If you take out more money from your current account than you actually have in it, you will become overdrawn. If this happens and you do not have an overdraft facility on your account, you may be charged a fee. This is usually referred to as an unauthorised overdraft.

    However, if your account has an overdraft facility on it, then you can agree an overdraft limit in advance with your bank. This authorised limit or agreed overdraft is the maximum amount you can take out, over and above what's already in your account.

    As with an unauthorised overdraft, if you exceed your authorised limit, you may be charged a fee. Likewise, while your account is overdrawn, you'll usually be charged a set amount of interest on the amount you have borrowed until you pay it back. However, an agreed overdraft may give you some financial flexibility, so it's useful to have. Just make sure you stay within your agreed limit. Plus, with the mobile banking services offered by most banks today, you can set yourself upper and lower limits on your current account. When you reach these, you'll be notified with a text alert, which could help you stay within your agreed overdraft limit.

    Check your balance regularly:  Banks offer a wide variety of ways to check your balance, which can really help you stay on top of your finances, particularly when you are on the go. It's worth checking if your bank offers ways for you to manage your money such as online, telephone and mobile banking. Plus, many banks allow you to check your balance at Cash machines, at their local branch or even at the Post Office©.

    Good debt and bad debt

    With the advent of government-sponsored debt in the form of student loans, it is now common for most students to have some debt. But the real danger of this is that students might begin to view all debts as the same, when in fact they aren't. That's why it's important to understand what's meant by the terms 'good debt' and 'bad debt'.

    A good debt might include something like a student loan because the interest is low. Obviously, no one wants to be in debt, but with loans such as these, remember that you are investing in your future.

    Bad debt is the kind you get with high interest loans or store cards where the interest could be anywhere from around 5% up to 30% a year. Don't forget, if you have a credit card and you pay your balance off before the required date, you won't be charged interest. Most credit cards offer up to 56 days interest-free, so check with your provider to find out how many days they offer.

    Student loans

    Student loans are among the cheapest form of long-term borrowing available. There are two different types of student loan. One covers tuition fees and is paid directly to your university; the other is for help towards day-to-day living costs such as rent and travel costs. All eligible students can get the full student loan for tuition fees, and may also be able to apply for a maintenance loan/maintenance loan grant for living costs.

    However, this changes depending on where you live, so it's worth looking at the 'Related links' section on the right side of this page to find out how you'll be affected.

    Remember that you won't have to start repaying student loans until you've left university and are earning more than £21,000 before deductions.

    Graduate accounts

    These are designed to ease you into your working life by still giving you student conditions, such as an interest-free overdraft, but phasing it down each year as you begin to earn (more) and helping you to pay it off gradually.

    When trying to choose a graduate account, an important factor to consider is the length of time you'll be able to use the interest-free overdraft. And, make sure you think carefully before opting for a fee-paying graduate account that claims to give you 'better' interest-free overdraft deals. It may work out more expensive to pay a monthly fee, usually around £5-£10, than the no-fee accounts with the best 0% overdraft conditions. The exception is if you think you'll use the additional benefits and that they are worth the extra cost.

    If you've left school and have place at uni, you've got three or more years of fun... and study, of course... ahead of you. You'll have an even better time if you do a little financial preparation before you go, so here are some suggestions:

    • Practice budgeting

    Your parents or friends may be able to give you advice about budgeting. Set yourself a budget, whether on paper or on a spreadsheet, for your current weekly or monthly spending. That way you can keep track of things easily.

    Create a basic budget, just so you get used to the idea of following how much you spend and how much income you receive. Play around with a layout that suits you, and headings that fit your lifestyle. For example, you might have an expenditure heading called "Entertainment" or "Stationery".

    Your income columns could include "Paid work" or "Parents". Try to fill it in for a week or a month to get an idea of how much you spend and where. This will stand you in good stead for university. If you can keep this up when you're a student, you'll save yourself lots of financial hassle.

    Look into student insurance

    Student accommodation and houses are notoriously vulnerable to theft because thieves know the security is often lax and there will be lots of easy-to-carry electrical equipment, such as laptops and MP3 players, around the place. If you have a few things of value, look into getting student insurance for your possessions before you head off to uni. You might even be able to get your parents to add you to their policy.

    There are insurance companies with policies designed Body_Contentally for students, such as covering you if you're burgled when a housemate leaves a window open.

    Holiday jobs are good for you students

    If you have more money coming in as a student, your life could be more enjoyable. So, it makes sense to supplement your loans, grants or bursaries with some income of your own.

    Jobs for students are a good way of earning money and gaining valuable transferable skills for when you graduate. The type of work could range from unskilled labouring through to bar work and office work. Not only will you benefit from a better bank balance, you'll get a taste for what it's like to work in a diverse range of industries. Who knows, it could influence your entire career decision.

    Start collecting

    You need quite a bit of stuff when you leave home - bedding, toaster, kettle, books... and it all adds up, cost-wise. But, if you start collecting these things as early as possible, you may even get the whole lot for very little. When you go to visit relatives, ask if they've got an old kettle or toaster in the loft; visit your local university to see if they're selling second-hand course books; browse online auction sites and local car boot sales.

    If you start before you go to uni and you're always on the look out for useful things, you could save yourself lots of money. You'll avoid all that last-minute organising stress, too.

    Budget power

    It pays to know how you spend

    University could be the first time you have to properly manage your own money, but don't worry, it's definitely more straightforward if you have a budget.

    Just take a little time to go through your income and outgoings - perhaps with a parent/ guardian or a friend, if you're not sure how to begin. Or, you could keep a weekly spending diary to see where you could cut back. Cutting back in one area might mean you're able to spend more money in a way you really want. Either way, it will help you to be realistic about your finances right from the start, and save you loads of trouble.

    Know your limits

    University is the perfect time to make friends and experience new things, but it's tempting to throw caution to the wind and overspend when you're socialising. When you're having a great time hanging out with your new mates, don't feel embarrassed to say no to that extra drink or that visit to a club if you feel you can't afford it. A little willpower can go a long way and your friends might even thank you for controlling their spending, as well.

    Give yourself pocket money

    Just as your parents may have given you a weekly or monthly allowance, this strategy will help you begin to think about and control your spending.

    Try this: On the same day each week, take out a fixed amount of money to cover your weekly expenses. Each weekly withdrawal must be for the same amount. This way you regularise your outgoings. If you start running low on funds you will, by necessity, begin to alter your spending. Having physical money go through your hands can make you realise how much you're spending, too.

    Be wallet aware

    If you love an afternoon latte or tend to get cash-happy on a night out at the pub, ration your cash on a daily basis. Not only will this stop you getting that final round in and blowing tomorrow's money, it will also allow you to save in advance for a special night out/occasion.

    House rules

    The biggest mistake to make when you're sharing a house or flat is to think that the everyday finances will take care of themselves. They won't, and could, at worst, cause serious arguments. So, take the initiative and hold a money meeting when you first move in - everyone will respect you in the long run.

    Make a list of the consumables that everyone shares, such as tea bags, toilet rolls, bin bags and cleaning stuff. Come up with a figure for everyone to put into the kitty every month, e.g. £5. There, job done, one source of bickering well and truly removed.

    Have similar meetings to decide the household approach to other finances, like the phone bill, or perhaps how the rent is split depending on the size of rooms.

    Don't splurge

    When you get your money through at the beginning of term, it's tempting to feel rich and to spend accordingly. Remember, it's got to last until the next term! Use your willpower, resist the urge to splurge, and you'll reap the benefits at the end of term when your account is still in good standing. That's the time for a well-earned celebration.

    As well as using your self-control, at the beginning of term you should put your money into things like books and equipment that you'll need for the year or longer, and which will lock your money away from the things you don't.

    Bargain hunt

    Think about what you're going to buy, then think where you might get it the cheapest. It's worth remembering that special offers are not always as good as they sound. Here are some more bargain hunting tips:

    • Make the most of student discount cards and the places where you can use them including local places that may also give student discounts.
    • Get loyalty cards for everywhere you might ever shop.
    • Use an online search engine to find websites that list all the stores and food outlets that currently have promotions.
    • Create a 'vouch pouch' where you chuck every voucher you come across and keep it in your bag. Then, every time you're on your way to the shops, have a rifle through them to see if you can use any.

    Living away from home for the first time is exciting but a little daunting, too. Our guide will take you through some important things you need to know as a student and help you make the right decision for you.

    Student halls of residence

    Most students moving away from home live their first year of uni in halls of residence. They're great because you're in your own place but still have a support network around you while you find your feet. Plus, they're a good way to make new friends and are often the cheapest option.

    Some halls are fully catered and provide meals, while others provide shared kitchens so students can cook for themselves. Self-catering halls can be cheaper, but sometimes you can pay extra to have meals cooked for you. Mealtimes are a great way to socialise and meet new people.

    Most halls have laundry facilities as well as cleaning staff who do some basic cleaning for you. Utilities, such as water and electricity are often included in the rental cost, so it's a good way to help you budget.

    Finding the right landlord: Accredited landlords

    Whether you're looking for accommodation through a private landlord or a letting agent, it's a safe bet to go for an 'accredited' landlord. They've agreed to abide by a set of standards relating to the management or physical condition of their property. Your university, student union or local council will be able to tell you about such schemes in your area and about private letting agents that specialise in student accommodation.

    Assured Shorthold Tenancy

    The most frequently used tenancy agreement (often referred to as 'the contract') in the letting of residential properties. This type of agreement is also referred to as an 'AST' or 'Shorthold Tenancy'.

    They are normally arranged for a six-month period, but can be agreed for longer, e.g. 12 months. This type of tenancy allows the tenant to remain in the property for at least six months, or an agreed initial fixed period. After that, usually the tenant - or the landlord - can give two months notice at any time.

    Tenancy Deposit Protection

    As of 6 April 2007, all deposits paid under assured shorthold tenancies have to be protected within 14 days of receipt by the landlord. The legislation aims to help make sure you get your deposit back - if you're entitled to it - at the end of your tenancy. With this new system, your deposit is held by an independent organisation.

    House-hunting checklist

    What to look for when renting student accommodation

    When you're looking around for student accommodation that won't break the bank, it's easy to forget about any priorities you might have when it comes to your living space. It might seem overly cautious, but taking a checklist with you will help you avoid problems later on.

    On the outside, look out for:

    • Slipped or broken tiles
    • Rotten timber (especially the window frames and doors)
    • Broken guttering
    • Crumbling or cracked walls
    • Adequate storage space for rubbish
    • If the property has a yard or garden, ask who will be responsible for its maintenance

    On the inside, check:

    • How many rooms are there in the property?
    • How many of these are communal rooms?
    • Are there enough facilities being provided for the number of people who will be sharing the house?
    • Is it furnished?
    • Is the furniture in a good state of repair?
    • Are the windows double-glazed and in working order?
    • How is the property heated?
    • Do the fridge, cooker etc. work properly?
    • Is there plenty of hot water?
    • Is the house free of damp and/or mould?
    • Are the bills on a meter?

    Safety features:

    • Have you checked to see that all gas appliances within the property have passed a safety test and have been included on the gas safety certificate? Over the years several students have died and thousands more have suffered illness from being poisoned by colourless, odourless, carbon monoxide fumes. The main cause has been faulty gas appliances.
    • Did the gas inspection take place within the last twelve months? Is there any fire detection equipment (e.g. smoke alarms) and do they work?
    • If a fire did break out, would you be able to escape using the main exits?
    • Has the electrical wiring been checked within the last five years?
    • Are all plug sockets free from cracks or other damage?
    • Are there sufficient plug sockets in each room?
    • Does all furniture comply with the relevant regulations?

    It's estimated that one in three students will be a victim of crime while studying. Much of this crime is property related, as student houses can have a high concentration of electronic equipment that makes them ideal targets for thieves.

    • Are there locks on the windows?
    • Have the previous tenants all returned their keys?
    • Have you got student contents insurance?

    Location of the property:

    • Is the area convenient for your studies?
    • How close are you to public transport?
    • Are local shops and facilities adequate?
    • Would you feel safe walking in the area at night?

    Rent and bills:

    It can be daunting managing all the bills. To help you budget it's worth getting together with your housemates to discuss how you'll look after the bills.

    Many students set up a bills account together and then all make regular contributions to it. They use this account to pay their rent, utility bills and TV licence. Many utility suppliers charge less if payments are made by direct debit.

    Many utility suppliers allow you to set up monthly payment plans that can help you manage bills better and avoid nasty surprises.

    When you finish uni, there's a lot of change. One of the biggest, and most daunting, changes is that you'll be financially independent.

    Graduates - life after university

    Graduating is an exciting time, with endless possibilities ahead. Initially your finances might be fragile after a few years of student life, so here are some ways to help you avoid getting into financial difficulties.

    Make a debt list

    With the advent of Student Loans, it's perhaps become more usual for students to leave university with debt. In some cases, this can be more than £10,000. This is normal, so don't panic!

    The first step to getting rid of any debt you might have accrued is to take stock by making a full list of what you owe and to whom. Put them in order of priority for repayment, with the ones with the highest interest at the top. Next, have a look at how much money you'll need to get you through the first few months in work.

    Create a budget

    Your spending will be different than it's been for a few years now that you're no longer a student. Try to pre-empt what it will be and start putting money aside to chip away at your dearest debts (the ones with the highest interest). Also, plan your budget for everyday things such as travel, work clothes and rent.

    Plan your student debt repayment

    Try to work out how much debt you can pay off each month. Based on this figure, plan how much the debt will reduce over the months or years. Apart from helping you organise your finances, this will mentally give you a tangible goal to work towards.

    Hunt for the best graduate account

    Just because you've been with a certain bank while you were a student, doesn't mean you have to stay with them. And although they may have given you the best deal as a student, the deal may not be as good for graduates. Shop around. As long as you've got a good banking history, can pay off any overdraft, and can prove that you've graduated, you can shop around to find the best account for you. But remember to look beyond the freebies and introductory rates - think long term. Also, weigh up the pros and cons of a graduate loan.

    Start saving

    Once you know where you are with your debt repayments, you can think about saving. A cash ISA could be a good starting point, as you don't have to pay any tax on the interest you earn and you can still get access to your money. You can save up to £15,000 in this tax year (2014/15) without paying tax. Even if you just start saving a small amount, it will get you into a good habit. Some banks also offer schemes that help you to save whilst you spend by rounding up what you spend to the nearest pound and putting the difference into a savings account.

    Leave your student loan to last



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