A few tips and tricks on how I budget and save to reduce money worries, stay dept free (other than the inevitable student loan dept) and still afford the things I love……
“A budget is telling your money where to go instead of wondering where it went” ~ John C. Maxwell
Whether you’re working full time or studying, managing your money with budgeting is crucial. Planning in advance where your money is going and what you need to spend it on each month will ensure that you always have the funds to afford the things you NEED. Notice I used the word NEED and not WANT because I’m sure you will agree there are so many things we want which we simply don’t need at this present moment in time.
I’m not saying we should avoid buying these things full stop, as we all deserve to treat ourselves every now and again and that’s one of the reasons why we budget and save in the first place. What I am saying though, is that prioritising your spending and keeping money to one side for bills and essentials will not only massively reduce stress and worry, but will also allow you to see what disposable money you have left to save or spend how you like as well as making yourself aware of what areas you can cut back on to result in maximum savings being made.
My experience with budgeting…
When managing your money and savings it is important to be realistic with your goals. This means taking into account your income and understanding that essentials must take priority over extra spending. I am a student working part time with a small business on the side, so budgeting has become a regular task for me. It is important to recognise budgeting, not in a negative (I cant afford things) way, but for the purpose of fully knowing where your money is going and to avoid spending on unnecessary things to enable you to afford the things you really want, holidays, trips, gifts etc.
As I first began to look at my expenses, I found I was spending money on small unnecessary things, and even though in the moment I wasn’t spending a large amount, over time these small purchases built up. This resulted in me missing out on certain things I wanted to do because bills and essentials had to then take priority with the money I had remaining.
I will share my tips on how I manage my money on a students income…
Pay day madness!!
Firstly, when I receive my student maintenance loan I immediately transfer it out of my account into a day saver. This account is not linked to my debit card so I am not tempted to spend it (thinking I can afford everything and anything). I have other accounts open other than my debit card account, giving me space for long term savings and short term savings for extra spending (so handy running up to birthdays, Christmas, days out etc)
“Balancing your money is the key to having enough” ~ Elizabeth Warren
Once the student loan is out of my main account, I transfer a specific amount into my long term savings account along with any money which I need to put to one side for bills that only get paid every 6 months or quarterly throughout the year. For me this is the water bill and the TV licence. That way I don’t need to worry about paying them when the bill is sent as I have already put that money to one side. This is especially helpful for my water bill every 6 months as each month it unnoticeably mounts up and then out of the blue I’m left with a large bill that I need to find the money for. Now I can just go to my savings and its there ready and waiting.
This leaves me with my allowance for the next 4 months before my next maintenance loan comes through. Along with my part-time income, this money is spent on rent, food, bills, petrol, entertainment etc.
This is where my budget comes in…
I take note of all my bills and general expenses that I have per month in order to calculate my total monthly expenses. I then minus my income off this amount and the remaining expenses is what I use my student loan for.
I now know how much of my student loan I’ll be spending per month. This is calculated for the four months which my student loan must last for and any money remaining is transferred into my short term savings for treats and days out.
I only go into my student loan account once a month to transfer my allowance for that month into my main account. I guess you could call that ‘pay day’ and this is done just before my largest bills are due e.g. Rent. This way I don’t have to worry about it and I know the money is always there ready to be paid out.
Other than the bills previously mentioned, I pay the smaller bills, food, petrol, day-to-day expenses from my other sources of income e.g. Working part-time. However, anything which is not calculated into my budget (e.g. Treats and days out) must be taken from my extra spending /short term savings account. I’ve found that this makes me more aware of what I am spending my extra money on and even more conscious about the little things I REALLY want which I’m saving for as appose to just impulse buying, which I used to do!
“A simple fact that is hard to learn, is that the time to save money is when you have some” ~ Joe Moore
This got me thinking, what about you…?
I’m always looking for more ways to manage my money better. I’d love to here from you about your experiences with budgets and savings.
FREE budgeting printable available… CLICK HERE
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