With the new academic year right around the corner, we thought it best to discuss managing your student loan!
Don’t Blow it All at Once
Many students make the mistake of blowing all of their maintenance loan in the first month or so of university, leaving them with nothing except their overdraft until the next instalment.
Your student loan needs to be managed responsibly and with care; it will only be given to you three times a year, so you need to make it stretch.
Budget From the Get-Go!
The quicker budgeting becomes a habit, the easier it will be to maintain. Work out exactly how much money you are going to have coming in from your maintenance loan and when this is.
Your maintenance loan doesn’t get paid to you in equal monthly parts like a salary. Instead, the annual amount is split into three chunks (which may be different amounts each time). You can expect your first instalment at the end of September or beginning of October, then a second instalment around January, and a third in April.
You can find out the dates of this from your online student finance account.
You may also get additional help from your parents or guardian, or income from part-time work, so make sure you add this into your budget too. You should make sure you include all of your outgoings in your budget. Costs may include:
- Transport
- Rent
- Bills
- Food
- Membership fees
- Phone bills
- Nights out
- Essential books for your course
- New clothes
Make sure to leave a buffer in your budget so that if an unexpected expense pops up, such as repairing your phone or laptop, you can afford to pay it.
Beware of the Overdraft
You should be wary about your overdraft. Many banks will offer students overdrafts of £1,500 to £3,000 and it’s important to remember that this is not free money.
Many students end up maximising their overdraft in the first term, and then are stuck owing a large sum of money. You will have to pay your overdraft back.
It is a better alternative than taking out payday loans, or paying with a credit card which you then can’t make repayments on, as the overdraft you are offered as a student is often interest-free. However, it should still be used with caution and avoided where possible.
Compare Banks
Before starting university, it’s also worth looking into different banks and what special offers they can give you to set up a student account with them. They may offer things like:
- Railcards, which then save you 1/3 on all of your train tickets
- Interest free overdrafts
- Tastecards, which can be used for discounts in participating restaurants
- Free or discounted cinema tickets
- Supermarket gift cards
Meal Plan
It is often cheaper to buy food in bulk and individual portions of vegetables and such tend to be pricey.
Therefore, it can be cheaper to be savvy with your shopping, working out what veg can be used in multiple meals so that you can buy a bigger bag and use it all without it going out of date.
You can also cook in batches, making multiple portions of one meal and freezing the other portions to have at a later date.
Additionally, make the most of things that have long expiry dates, such as cupboard staples like pasta and rice.
Student Discount is Your Best Friend
Take full advantage of your student discount! Students are offered a huge range of benefits and discounts from many different places.
You will be entitled to discounts on food, drinks, activities, clothes, and many more.