Make Your Student Loan Last: 3 Essential Tips

This guest post was written by Jack Curtis and is intended for a UK student audience.

One of the major life skills developed at University that not many people speak about is learning to manage your finances and make your student loan last. Arriving at University and seeing your first disbursement hit your bank account is a memorable moment for any fresher. It signifies new independence and responsibility in your life that you might have never had before. 

However, this money can seemingly disappear and run out fast as many freshers quickly discover.  Especially if you’re staying in student accommodation, as after the high rent costs are removed from your account you may be left with a lot less than you had originally thought. Once you factor in the traditional student lifestyle of drinking, takeaways, and shopping sprees, you begin to realise how expensive the student lifestyle can actually be.

You don’t want poor money management to negatively affect your University experience or leave you forced to work summer jobs to pay off any debts come the end of the year. Instead, try following these 3 student budgeting and spending tips that will make your student loan last longer while still allowing you to enjoy your time at University.

Plan Ahead

Before you even head off to University, you need to be planning ahead on how you will be spending your loan. Once your loan application has been approved and you know how much you will be receiving, create a budgeting spreadsheet. Start by predicting your weekly outgoings costs per term e.g. rent, food, socialising, and travel money to calculate your cost of living. If you’re not sure how much something like food will cost you each week, overestimate its cost. That way you won’t be caught out if it’s more expensive than you thought. 

Create a Budget

Figure out how many months your student loan instalment has to last before the next one to give you your weekly budget. Make sure you aren’t spending all your loan in your planning and leave some spare cash as you can’t predict unexpected costs that potentially could spoil your spreadsheet. It may be boring to create but it will massively help you in the long run to keep track of your spending and make sure you have enough money to last the semester.

Stick to It

The most important part of creating a budgeting spreadsheet is sticking to it, otherwise it is useless. If you think of yourself as an impulsive spender or lack the self-control necessary to budget long term, then look into opening a savers account to help reduce the temptation to dip into your living cost allowance. Store the majority of your loan in your savers’ account and only hold in your bank account what you have allowed yourself to spend. This is so important as spending beyond your means can quickly end your University experience and leave you in debt with no degree to show for it. 1 in 16 students now leave their undergraduate course before the end of year one, with financial reasons being a major factor.

Shop Smart

Now you have planned how you’re going to distribute your loan, the next skill is making sure you find the best prices for what you buy. It is unrealistic to ask a student not to spend as a method of saving money. University can be an amazing experience that shouldn’t be limited by not spending any money. Instead, you should find efficient ways to keep your costs down.

Limit Frivolous Spending

For starters, food can potentially take a large chunk out of your budget, when it doesn’t have to. Avoid buying takeaways or visiting restaurants often. It’s interesting to consider that the price of one large takeaway pizza could actually feed you comfortably for 3 to 4 days when you shop smartly. Also, the last thing you want to do is become friends with the takeaway delivery driver.

Choose Better Stores

Cheaper supermarkets like Lidl or Aldi are your best friends. £20 in there will likely take you much further than in Marks and Spencers and the small savings you make on each product will add up to help you in the long run. If you don’t see yourself as the next Gordon Ramsey however, then there are quick solutions that aren’t a takeaway or a restaurant trip. Either teach yourself how to quick and tasty meals like pasta dishes or take advantage of the vast array of ready meals and meal deals that supermarkets like Tesco offer. If you are living in shared accommodation, then try sharing and splitting the costs of cleaning products and certain foods products like salt and pepper with your flatmates if possible as it will benefit everyone living there financially.

Avoid Subscriptions

Until you have a handle on your disposable income, you should avoid subscriptions where necessary. Things like PlayStation Plus, Netflix, and Spotify Premium might be something you feel is absolutely necessary but realistically it may be something you aren’t able to afford on your budget. Adding up all your monthly subscriptions could leave you with little else to spend. So make the hard decision about which subscriptions you need in your daily life and which are just nice to have, and cut the latter.

One final tip that could potentially save you hundreds and make your student loan last is pre-drinks. When going on nights out, clubs and bars can charge extortionate prices on drinks that will absolutely add up to a regrettable list of charges the next morning. Supermarkets sell beer, wine, and spirits for much cheaper and in larger quantities, allowing you to dictate how much you spend on the night out while still having a good time.

Take Advantage of Your Student Benefits

Being a student comes with many financial benefits you may not be aware of, starting with student discounts. If you’re a shopaholic or just love going out, make sure to research and apply for student discount services like UNiDAYS and a TOTUM or NUS Extra card. These allow for small savings at thousands of brands and locations. Using websites like Save the Student! will keep you up to date on any other benefits and offers being a student can get you.

Most banks will offer you the chance to open a student bank account, each offering their own unique benefits such as a free railcard or free cash. The majority will also offer an interest-free overdraft in case you need it. Remember however this is not free money, as they will expect whatever you borrow to be paid back by the time you finish your degree.

Though it is sometimes included in a student bank account, if you are moving a long distance away from home or would like to travel around frequently, a 16-25 railcard is a must. It will save you heaps of money by reducing a ⅓ of the cost on every ticket and should absolutely be taken advantage of while you are within the age range.

Get a Part-Time Job

If your spending habits are greater than the loan you’ve been given, or you find you just haven’t been given enough money, then getting a student job is the obvious solution. You will have plenty of time around your studies to work a part-time job so it suits your student lifestyle. If you have moved to a big city, then there will be plenty of retail positions or waitstaff jobs available. A part-time job will keep your finances topped up and can also be a fun and rewarding experience in your free time that will help you make new friends and bolster your CV.