Managing money as a student can be overwhelming. It can feel just like trying to juggle plates while riding a unicycle. Everything is spinning and out of control. Between rent, food, tuition, books, and still trying to participate in some kind of social life, it can be extremely stressful. Many students feel like they are broke before the month even starts, let alone being able to get through the month without any issues. However, there is good news. You don’t have to be a business or finance student to take control of your money. With the right practices, habits, tools and mindset, you can better support yourself, manage your money, add a little extra income to your month and reduce the stress of debt along the way.
To support you on your journey, here are some top tips to help you.
Understand your current financial situation
Before you take any action, it is vital that you look at your own financial situation and understand where you currently are. This will help you to tailor your mindset, actions and habits to your needs. If not, you may take steps that make your financial situation worse.
In order to do this, you can start with a simple review and spreadsheet. Go through your finances and add everything to a spreadsheet. You can be as simple or creative as you like, as long as you can see what is coming into your account and what goes on on a regular basis. List all your sources of income, such as work, grants/schemes/loans, allowances and side hustles. Use your spreadsheet for a month or a few and track everything to see how it fluctuates each month. This will not only give you a better idea of your true financial situation, but you can also get a better idea of your spending habits. Many people underestimate how much they spend or have direct debits they have forgotten about. Small purchases add up. The tools you use don’t matter, so do whatever is easier for you. A spreadsheet, a notebook, an app, for example.
The next step to understanding your finances is splitting your finances into needs and wants. You can gain a much better perspective of what you do with your money this way. Essentials would be things like groceries, rent, books, etc. Wants might be impulse purchases, eating out, streaming subscriptions, etc. You don’t have to get rid of all of your wants, but it is a good idea to see which ones you don’t use or are not necessary right now. This can help you reduce your outgoings, as well as start to improve your mindset around money.
Build a student-friendly budget
Unrealistic budgets are going to fail. Not only do you need to have a good understanding of your financial situation, but you also need to know how to plan accordingly and set yourself up for success. A good budget for a student is one that is flexible.
Work out how much you need for your needs and essential items. You can then work backwards from your total income to see what percentage you can put towards your savings, and what you can put towards your wants. A safety net should come second, and wants third. Working in percentages is a good idea, especially if your income tends to fluctuate, which is common for students. It is very rare for a student to be on a set or salaried income, but instead, work in shifts, which means income is going to be different each month.
When creating your student-friendly budget, it can be a good idea to create your budget by semester, rather than monthly. This is helpful if you have a loan that comes in each semester, as well as irregular income and expenses. Plan for the bigger costs first, such as tuition, books, housing, etc. and then from there, you can break it down monthly for your budget.
Smart saving ideas
Saving money isn’t about going without, but about the habits you can build around efficiency. Start with an emergency fund with a percentage of your income. This might not seem ideal now, but it will help you in the future with any car repairs, medical bills or travel expenses. Automate your savings so that it is taken from your account and put into a dedicated savings account each month. This will ensure you don’t forget or spend it on an impulse instead. When it is out of sight, it is out of mind. Do your research for high-interest savings accounts so your money can be working harder for you while it just sits there.
See where you can be smart and save money. The best money saving habits are often the ones that help you overall. For example, cooking food from scratch and batch cooking food can be a lot cheaper. Use energy-efficient appliances, source new utility bill contracts each, negotiate your rent and cancel or share subscriptions.
Smart money-making ideas
Making money can be hard, but with the right side hustles, you can leverage your spare time to build skills as well as money. Consider any on-campus jobs first, as these are tailored to student schedules and provide you with security. Alternatively, you can go freelance and offer services such as writing, graphic design or social media management. Some students have found success with custom Greek merch that they design and sell.
For an additional top-up of cash, go through your belongings and sell anything you don’t need or want. This can be clothes, as well as old study text books that other students on a budget could benefit from. You can sell these online or locally. Decluttering your room and your finances can be a win-win.
Money management for students isn’t about being perfect or working yourself into the ground to earn more money. It is about being intentional. Usually, there are a lot of mindset and habit changes that you can make before you think about a new income stream.