When I started to write this blog, I thought about my time as a student, and how money had not really been something we thought too much about. It wasn’t because we had plenty of it, but because there wasn’t really any discussion around how we could and should look after our money.
I appreciate that given the pressures of being a student, along with all the other things going on in people’s lives such as families, jobs, friends, hobbies, and other general commitments, thinking about finances can fall a little down their list of priorities — but it’s important to get to grips with personal finances early.
I won’t focus solely on how your students can save money for their futures but will take a look at a few ways they can be savvier and perhaps have a bit left over each month to put to one side.
1: Look at what’s available
A lot of money can be saved by making use of discounts and cashback offerings. Almost all colleges and universities have connections to local businesses who are willing to provide their products and services to students at discounted rates and prices.
In addition, there is the very popular national initiative known as TOTUM (Formerly the National Union of Students NUS) who provide a large number of discounts, deals and sales on a wide range of popular national brands that are only available to students.
2: Think about insurance
Insurance doesn’t need to cost the earth and not all insurance products are a necessity. However, there are some products that could save learners lots of money in the long run if the worst should happen.
One example might be a mobile phone or gadget insurance. Laptops, tablets, phones and other digital devices are very valuable resources for almost all students, and therefore replacing them (should they be lost, stolen or damaged) can not only be very costly and eat into an already tight budget but can also disrupt their studies. You don’t need an explanation as to why that’s a bad thing.
3: Budget, budget, budget
This is so important, no matter what level of income students get, they must be able to understand what comes in and what is going out.
I would always suggest having a good understanding of the mandatory payments such as rent, mortgage, insurance, food, utilities, mobile, etc, and the discretionary payments and subscriptions such as gym, TV, and eating out.
Putting this into a spreadsheet, or using one of the many apps available, can help to see the amount of money available each month and see where savings could be made.
4: Save for emergencies
Once they know how much is available each month, they can start to put money away.
I know the various products and services available to students from my time working at a bank. There are some great bank accounts offering the insurances mentioned above for one small monthly fee which are worth looking into.
I always liked to discuss instant access savings accounts and ISA’s with students as well, even if it meant only putting £20 per month away — it meant they could start to build up a little extra for emergencies. Doing this as soon as you are paid is a good habit to get into.
5: Save for the long term
Just because they are students and may not be earning a huge amount of money (yet), it doesn’t mean they can’t put money aside for the future.
There are some great low-cost automated investment applications available that allow people to open savings and investment accounts and are designed for putting a little money aside for the longer term. I would only suggest doing this once the other points above in place — make sure they can afford to put money aside for the short term before thinking about investing for the longer term.
6: Speak to your college or university about the financial services available
There are a vast array of different loans, grants, bursaries and other financial support mechanisms that can help students ease the financial burden of studying, depending on their circumstances. The student finance teams at your institution are the best people to speak to about this.
Hopefully, the above hints and tips are a good start to your student’s journey as a savvy student spender, but please remember not to put too much pressure on the idea of saving and investing because, at the end of it all, they should be enjoying their time as a student and having experiences.
So if there is one thing to take from this blog it is the idea of budgeting. Want to do something? Budget for it. Can’t afford to do it right now? Save up for it.
About the author
Angelo Kornecki APFS. P.G.C.E is a Chartered Financial Planner, Tutor and Lecturer in Financial Services, and Founder of AKORN Financial Advice Ltd and AKORN Education.
The views, thoughts, and opinions expressed in these blogs belong solely to their authors and are not necessarily those of Pearson.