How to make a student budget and not go broke.
We plan our student budget so that money remains both for studies and for entertainment.
Many students, having gone to study abroad, for the first time are faced with the need to independently manage a budget, plan their income and expenses. Because of this, already in the first months of “adulthood” students often experience financial problems. This is usually about overspending and under-budgeting, and it can be very difficult for a parent to admit it.
According to the results of the National Student Money Survey 2018 , as many as 78% of students experience constant anxiety about the lack of money, and another 70% regret their own low level of financial literacy.
What to do to avoid money problems? Everything is quite simple: you need to learn how to correctly draw up your student budget, which will allow you to easily cover all the compulsory expenses and not save on additional expenses.
Latest School News have prepared useful tips that will increase your level of student financial literacy and help you forget about money problems once and for all!
Why budget at all?
Budgeting can seem boring enough for a student, and yet there are a number of benefits to keeping your expenses in check.
Imagine that your bank account is a leaking bucket. Periodically, the tap opens to fill it – this is your income.
But your bucket is full of holes through which your money flows. The water level will constantly change, but as long as there is enough water in the bucket, there are no problems.
However, a problem will arise if the water level gets too low. You will need to start closing those bucket holes (your spending habits). This is what budgeting is all about.
In short, it helps maintain a constant water level so you can keep spending money on what you want and love (within reason, of course).
Regardless of whether you are trying to set aside a large sum, for example, on vacation or your first car, or you just want to insure yourself in case of emergencies, such as urgent treatment or repair of broken electronics, a well-planned budget will greatly facilitate and streamline your student life. …
Student budget planning
The basic mechanism for drawing up a student budget is quite simple: you need to calculate the amount of your income and the amount of expenses, and then understand how they are balanced.
How to make a student budget and not go broke
This will allow you to understand how to reallocate your expenses in such a way that not only can you easily pay all the necessary expenses, but also save significant amounts.
1) Set your income
First, calculate what your total monthly income is. Typically, students’ income consists of the following amounts:
- money from parents
- scholarship or grant payments
- a patch from a permanent job or part-time job
- other savings
2) Set the amount of your expenses
Then you need to calculate how much you spend per month for each expense item. At the same time, expenses can be mandatory and optional:
- bills (gas, electricity, water, insurance, mobile communications, internet, etc.)
- transportation services (travel tickets or car maintenance costs)
- textbooks and other materials necessary for study
- visiting cinemas, clubs, parties, etc.
- eating out
- spending on hobbies and leisure (buying books, visiting workshops and classes outside the university, buying tickets for concerts, etc.)
- visit to the fitness club
- clothes and shoes
- visiting a hairdresser, beauty salon, etc.
- paying for digital services like Spotify or Amazon Prime
- travel expenses (flights, hotels, transport, sightseeing tickets, etc.)
3) Calculate your weekly budget
After setting your income and expenses, you can calculate your weekly budget. For this:
- deduct the amount of mandatory monthly expenses from the total amount of monthly income
- divide the result by the number of weeks in a month
The amount you receive is your weekly budget, which you can use as you see fit, without compromising on mandatory expenses.
4) set a goal for yourself
So you’ve calculated your income, expenses and set a weekly budget? Fine! But what if you have too little money left for all your expenses per week?
Whether you want to maintain your budget or cut your spending, it all comes down to setting financial goals to either cut your spending or increase your income.
For example, if you spend $ 100 a month on food away from home, you can learn to cook and cut that item in half at least.
Or, if you spend a lot of money on a fitness club membership, you can find out about the free sports opportunities of your university or reconsider your approach to sports and choose another, less costly, type of physical activity.
Agree, keeping all these calculations in your head is not very convenient, which is why it is important to know about special tools for competent budgeting …
We have already told you how and why to create a student budget. Now it is also worth noting the tools that will help you in budgeting, save you time and effort.
Excel Budget Spreadsheet
If you are not friendly with mathematics, are not ready for complex calculations and high-tech solutions, the simplest Excel spreadsheet will help you in budgeting, which you were probably taught to create back in school. Here you can easily create separate columns for each item of expenditure and income, and using the specified mathematical calculations – calculate the budget.
Mobile apps for budgeting
If you prefer to use mobile apps, you can download one of the many dedicated budgeting apps. Such applications take into account all items of expenses and income, form a monthly and weekly budget themselves, indicate items with overspending and give advice on reasonable cost savings.
Among the most popular applications:
- Zen Mani
- Money flow
- Money lover
- Money ok
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