3 essential ways to save money as a student
We all know that life as a student can be expensive — especially if you don’t live at home! Accommodation, living costs, and, of course, being able to fund an active social life! Whatever your means, you don’t need to fall into the skint student stereotype: living off instant noodles and £10 per week because you wasted your loan on an impulse shopping trip as soon as it hit your bank account.
Learning how to save money and managing your personal finances is a priceless skill that will help you shape your future. Learning to budget and getting wise with thriftiness can help you to make the most of your money and help you so much in the long run. This makes the process of choosing the right university courses and postgraduate courses as well as choosing your place of study, and standing on your own two feet an important transition into the next stage of your life.
This article aims to offer tips on the best ways to save money while living the student lifestyle.
Choose your student bank account wisely
Banks love students. That’s why they offer a plethora of zero per cent overdrafts and free goodies to tempt you into using their services for years to come. Student accounts are simply bank accounts that have additional benefits to facilitate your life as a student, such as 0% interest overdrafts and free goodies.
It’s important that you don’t just go for the bank with the best extras — although yes, a free four-year railcard or £100 could be useful. In the long-run you could be shooting yourself in the foot by not considering the important things.
Most likely, you’ll spend a considerable amount of time overdrawn. Take a look at each bank’s overdraft deals and go for the bank that offers the largest amount that will last the longest. Keep your eyes peeled for overdrafts that are ‘guaranteed’ instead of ‘up to’ — the latter means you’ll only get the maximum overdraft dependent on factors such as a credit check and how many years you’ve been at university.
For example, if you go with a student account where you have to repay £2,000 student debt a year after graduating, you’ll probably not want to use your overdraft or have chance to save. Having a longer period of time to pay off your debts will give you more freedom with your cashflow and the ability to use money for other things, without the worry of having a small amount of time to pay it back.
How digital banks can help
According to that old cliché, a little can go a long way. And this is certainly true for digital banks such as Monzo and Starling. In case you didn’t know, you can have more than one bank account, which can be particularly useful in managing money. For example, you could have your student loan drop into your student bank account and transfer yourself monthly or weekly budgets to a digital bank. Not only do you get notifications on your phone every time you make a payment, it gives you daily summaries, and even allows you to round up your purchases.
Rounding up is a way of micro-saving, a common way to currently save money. Each time you pay for something, it’ll be rounded up to the nearest pound and the difference will be stored away for savings. For example, if you buy a coffee for £1.50, 50p will be saved. Over a period of time, you’ll find that you’ve got a nice lump sum saved for something exciting or useful.
Thrifty food shops
Did you know that the ‘best before’ dates on food are purely recommendation and are an indication of food quality opposed to safety?
The Approved Food website is an excellent way to save money on groceries, whether you’re a student or not! Approved Foods delivers food to your door that is near or past the best before date that, according to the NHS, is perfectly safe to eat unlike ‘use by’ dates that you shouldn’t ignore. You can buy staple essentials, fruit and veg, and toiletries. Understandably, meat and dairy aren’t sold.
According to Save the Student, you could save up to 70 per cent on a food shop! For the items you need from a supermarket, we recommend going food shopping in the evening, when shops are reducing prices on products that needs to be sold by the close of play.
Doing things like setting aside money to cover rent and bills for the next several months until your next loan instalment is a good idea. This way, you won’t be left with any surprises and you know that all essentials will be paid, and how much you’ll have left over to play with. Download cashback apps such as Quidco and Topcashback that give you a percentage back for making payments through their app!