According to the NUS, one in five students drop out of their courses and the main reason given is financial hardship. As debts start to pile up it is really important to keep a tight rein on your budget, particularly in the first few months when you are still a novice at being financially independent.
Suzanne Allott is the students union welfare officer at Newcastle University and she sees a lot of students with budgeting problems. "The problem is that when students come straight from home to university they are not used to having to live on a budget. Their loan seems like a lot of money but it has to last till Christmas and lots of students splash out in the first few weeks and then have nothing left."
She advises students to write down all their expenditure and all their income on a spreadsheet and work out, down to the last penny, exactly where all their money is going. Like many universities, Newcastle has a students union website which offers lots of advice on setting out a spreadsheet and budgeting. It is not difficult, so try it yourself.
Draw three columns and in column A write down all your fixed expenses over a month like tuition fees, rent, gas and electricity bills, water rates, phone bill, insurance premiums and council tax. In column B write down all your variable expenses including food, takeaways, travel, toiletries, laundry, entertainment, sports and societies. In column C write down all sources of income including student loan, parental contribution, overdraft, part-time or vacation work and savings. Add up A and B and subtract from C. Not much left? If there's nothing left cut down on the takeaways!
There are lots of ways to make your money go further. Top tips for sensible accounting are: choose a bank with the most favourable terms rather than the one with the best freebie; have your loan paid in three instalments; set up direct debits for rent and all major outgoings; arrange for your parents' contribution to be paid monthly into your account; avoid credit cards; and don't go beyond your overdraft limit without the bank manager's permission or you'll end up paying horrendous bank charges.
On the food front: eat in and share meals with your friends. It really is cheaper to split the cost of food and set up a house kitty. …