Blog: 5 things I wish I'd known about managing my money
Hi everyone, my name is Robin Lapwood and I’m currently studying for my Doctorate here at the University of Birmingham. If you’ve watched my ‘Day in the Life’ video, then you’ll have seen that the one thing that makes me stand out from other students is that I’m in my mid-60s (although I still have the fashion sense of a 13-year-old).
With the increase in the cost of living, I know that money is a concern for many students. Although it’s great that the University is putting things in place to support students with financial advice and initiatives, it’s a hard time for everyone. To be honest, I learned the hard way as a young adult that while spending is fun, it comes at a price.
I’m by no means a financial expert but here are some things that I’ve learnt along the way that helped me manage my money more effectively; from choosing accounts which pay you interest to knowing your outgoings, here are my words of wisdom about earning, saving and spending.
Make your money work
Whether you’re a home or international student, you’ll need a bank account in the UK to pay rent and tuition fees, receive wages and manage other daily expenses. There’s a lot of choice out there, but I would recommend looking into setting up an interest-bearing account. This is a type of bank account that pays you a little bit of money on the money you hold with the bank. If, like many students, you get a dollop of cash every term, then it feels like a waste to have all that money just sitting there earning no interest, especially with the rate of inflation. With an interest-bearing savings account then you’ll at least keep up with inflation, if not actually add a little value to your cash. It’s a no-brainer to me. There are lots of accounts out there, and not all the same so make sure you compare and find the one that suits your needs the most.
Know your budget — and stick to it
Make a list (or even better a spreadsheet) of your essential regular monthly outgoings such as rent, food, bills, travel, stationery etc along with money coming in such as any loans, grants, income from part-time jobs, savings etc. This will quickly help you prioritise your spending and show how much ‘spare’ cash you have for other things such as clothes, and eating out/socialising with friends. Don’t forget, there are ways you can reduce your outgoings such as buying second-hand clothes, always asking for student discounts, sharing subscriptions with friends, and making your own food.
Limit your access to easy money
Even now, I still love impulse buying — especially if it’s shiny or has a trending fashion label. So, what works for me is to have a special bank account just for treats. I transfer a fixed amount into this every month and set up my debit card to spend from that account. Easy. Of course, in a real emergency, I can always access my main account or my savings — that’s the beauty of App Based Banking — but, for limiting day to day impulse buys, having a limited amount available really does help.
Avoid having a Credit Card or a Store Card
We’ve all been there...“Of course I’ll pay my credit card/store card bill every month, so there will be no interest...” Right. It can work — but usually it doesn’t (otherwise credit card companies would be out of business). So, when your financial month goes wrong, and you can only pay back the minimum amount, you start being charged interest — which can be anything from 25% to 30% plus. Even though this rate is spread out over a whole year, the debts can quickly mount up and, from month two onwards you’re being charged interest on the interest, eek! As tempting as having a credit or store card might be, I would advise staying clear of them unless you’re confident you can manage repayments. If you do need a credit card, take some time out to read this article from Save the Student on how to make student credit cards work for you.
Just say no…
Setting up a good banking system is only half of the battle for me: I often need to remind myself to say ‘No’. Even when I’m scrolling on Instagram, adverts pop up for all kinds of shiny things I never knew I needed (like ultraviolet nose hair removers). And, of course, if you click on one advert it tells the AI to send you even more that are similar! Just ignore them. Don’t give in to the pressure to spend money on things you don’t actually need, especially buying things just to keep up with your friends. Instead, take time to think about your purchases. If at the end of the month, you have some spare money in your treats account, reward your resistance by getting something a little special.
Money and mental health
My first three years as a student (back in the 1970s) were pretty miserable if I’m honest. My credit card was maxed out, and I simply ran out of money for important things like food and stationery. For example, at the end of my first term at Uni, with just £25 left to last me two weeks, I despaired — and so went out and bought a new programmable calculator to help me with the sums. It cost £20. I still have that calculator: it keeps reminding me that staying in control of my spending always leaves me feeling happier and less stressed than giving in to impulse buying. As students, I think we can all find deeper peace of mind by setting a realistic budget, prioritising our spending, being content with good-value items, and not wasting money on things we don’t need.
If I had known then what I know now, I would have had a much healthier and happier time at Uni as an undergraduate. I hope this advice will prove helpful to you too.
Remember, if you’d like any financial support or information, visit our Cost of Living intranet page and the Guild’s Money Matters hub.