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Student finance and budgeting guide

Published 7 September 2011 by

They say your student years can be the best time of your life, and starting university for the first time can be an exciting - and nerve-wracking - experience. You may be living away from home for the first time, making new friends, and generally learning to be more independent.

However, getting the most out of your experience at uni also means you'll have to think about how to manage your money well during your time there.

Here's a handy guide on how to successfully keep on top of your finances while you study.

Student budgeting

We've all heard stories of students living on tins of beans for two weeks because they've run out of money after paying the rent. But this doesn't have to be the case - a good budget can help you make sure you have enough money for all your essential costs, and still have some left over for those late nights with friends too! So…

Add up all the income you get

The first step in working out your student budget is to add up all the income you receive while at university. This could include:

  • Your Maintenance Loan. This is worth up to £4,950 if you live away from home and are starting university this September (or £6,928 if you're starting university in London). This is paid in instalments, so keep an eye on your 'Payment Schedule' from the Student Loan Company to keep track of when the money's paid into your account.
  • Any Maintenance Grants or bursaries you may receive if you're from a low-income household.
  • Any wages you earn if you're working part-time or have a weekend job to support yourself through uni - have a look at student jobs and see what you can find if you're looking for some extra cash.
  • Any savings you have from a summer job or any trust funds your family set up for you.
  • Any money you may get from the 'Bank of Mum and Dad'!

Work out all your outgoings

Living away from home for the first time means you'll have new responsibilities with your money that you probably haven't had to think about in the past.

It's important to work out your essential expenses: all those things you'll have to spend your money on every month to get by. This includes:

  • Rent. If you're living away from home for the first time, paying your rent - and making sure it's on time! - is a big challenge, and will be one of the biggest monthly expenses, if not the biggest, you'll have to cover.
  • Utility bills. If you're living in student halls of accommodation for your first year, gas, electricity and water bills are usually included in rent costs, but you may need to set money aside for laundry bills or buying other cleaning products.
  • TV licence. Don’t forget that you’ll need a TV licence if you want to catch your favourite soaps or football games, even if you plan to watch them on a laptop or computer. This costs £145.50 p/a, but you could spread the cost with Direct Debits (for around £12 per month). If you're really feeling the squeeze, or if you're extremely nostalgic, you can get a black-and-white licence for £45.
  • Food. Work out a realistic amount to spend on food every week, including those all-important staples such as bread, milk, cereal, pasta, rice, etc. Don't forget about the things you maybe shouldn't spend your money on, but you know you will, whether it's those takeaways, tubs of Ben &Jerry's or BOGOF bottles of wine in Tesco. Plan your meals over a week - blowing your budget on crisps and cookies might seem like a good idea at the time, but living on couscous when you've virtually run out of food will be a memorable experience for all the wrong reasons…
  • Travel costs. However you travel to university, make sure you work out how much you'll spend on tickets and student travel passes (e.g. weekly bus ticket, student railcard) every month and account for it in your budget.

All the costs like these should be prioritised in your budget. Whatever you have left is your disposable income: you can spend this as you like: nights out, meeting up with friends, club membership for any student organisations you join, and - of course - for Freshers' Week.

Remember: you'll have to stay within your budget to make sure you can cover the important day-to-day costs of being at uni as well as the fun stuff.

Reduce your outgoings

There are ways you can reduce the amount you spend every month - so you can (1) afford all your essential living costs, and (2) possibly still have some money left over to spend on whatever you like.

You could think about:

  • Buying items from the 'reduced aisle' at your local supermarket, or - even better - go 10 minutes before closing time. You could find vegetables and other fresh items at much lower prices.
  • Taking a packed lunch and flask with you to the library rather than spending money on lunch while you're out.
  • Sticking to the student union when you go out socialising to take advantage of cheaper prices.
  • Looking out for student discounts. Many shops offer 10% discounts on items and services if you have an NUS/student card - ranging from clothes and books to cinema tickets and railcards. You could save £s in your budget.
  • Taking advantage of online vouchers on websites such as Groupon, which can help you save a considerable amount on everything from eating out to shopping.

It's also worth thinking about the time you spend away from university, such as the summer holidays or Christmas. With so much free time, it's easy to go 'crazy' and spend your money all in one go. Have a look at this guide to budgeting during summer for some tips and tricks you may not have thought of.

You may feel you can afford a holiday. There are low-cost ways of doing this - and after all those hours in the library 'cramming' for exams, you've probably more than earned it! Again, have a look at this guide to managing your money on holiday that we wrote a few weeks ago to help you get away for less.

Be cautious about borrowing

Some companies target students with credit cards, store cards, payday loans and other forms of credit. While they can work as a way of temporarily boosting your budget, you should try to steer clear of borrowing, or at least keep it to a minimum - and only treat it as a short-term 'fix' that you can repay as quickly as possible.

If you have any concerns about taking on a credit card, or any other budgeting issues, speak to your student welfare officer or money adviser to discuss your options.

Student banking

Getting a student account is another important step in your new life as a student. With all the different options available, it can seem overwhelming, but following these tips can make finding the right student account that bit more straightforward:

  • Shop around for the best student account. Don't assume that switching to one with your current bank is the best deal - you could be missing out on a better one elsewhere. You could check price comparison websites to help you find the most competitive student account - and ideally set up your student account before you start term (you can do this as soon as you get a firm offer from UCAS).
  • Consider choosing a managed account - such as this one - which could help you with budgeting and paying your monthly bills. It could take a big weight off your shoulders.
  • Sign up to online/telephone banking or download an 'app' for your smartphone to help you manage your money: you could check your balance on the go, view your weekly statements and generally make keeping on top of your money fit with your busy student lifestyle. Just remember to keep your passwords safe, never store them in your phone or in your purse/wallet, and be wary of using public places to access confidential financial information.


Chances are you'll be taking a few expensive items with you to uni: whether it's your laptop, smartphone, iPod/MP3 player or any designer clothes you have. Particularly when you're living in student accommodation with strangers for the first time, keeping your valuables safe is a priority.

Finding a good contents insurance policy is a great way of protecting your belongings while you're at uni - and can give you real peace of mind that if your phone is stolen or you lose your laptop, the costs should be covered. However, check with your parents first, as you could already be covered under your family home policy. If you aren't, see if they can add you on to their policy - which could be a cheaper option!

Benefits of student budgeting

Budgeting while you're at university doesn't have to be difficult. What with essays and revising for exams, the last thing you need is the added stress of worrying about how to pay the rent or wishing the days away until your next loan instalment.

However, with the right amount of organisation and commitment, a good student budget can help you make sure you get the most out of your time at uni. A report from the BBC revealed that students could end up paying back double their student loans after 2012's tuition fee increase - but if you're super-savvy with your money, you could minimise the amount of debt you end up with, and graduate with nothing but your student loan to repay.

A good student budget could help you make your money go further, expand your dietary horizons beyond baked beans and enjoy a busy social life. After all, university isn't just about getting a degree!