Building an emergency fund means setting money aside for unexpected costs. While saving money as a student might sound impossible, it can be achievable if you start using helpful, realistic habits.
Why Might Students Need an Emergency Fund?
You never know when something could go wrong, such as a laptop breaking during exam season, a car needing urgent repairs, or a disruption to income. Having some money set aside is like a safety net, ensuring you’re covered if something goes wrong. It can also give students peace of mind, helping to reduce financial stress.
How Much Should Students Aim to Save?
Some people recommend the 50/30/20 rule, where you spend 50% of your money on essentials like utility bills and groceries, 30% on wants like socialising and hobbies, and 20% on savings. However, saving money as a student can be hard, so it’s okay if you can’t save this much. Building an emergency fund doesn’t mean you have to save hundreds of pounds every month. Even small amounts each week can add up over time.
How Students Can Start Saving Money
Create Budgets and Stick to Them
Many mobile banking apps allow you to categorise your spending so you can see where your money is going. By doing this, you can identify areas where you can spend less and create realistic goals and budgets. For example, you might set a goal to spend £5 less on your food shops, or give yourself a budget of £25 next time you go clothes shopping.
Start a Part-Time Job
Getting a job provides another source of income that can be put towards an emergency fund. As well as the obvious benefit of earning money, part-time jobs can give students experience to add to their CVs and help them develop skills which are valuable to future employers.
Use Student Discounts
Apps like UNiDAYS, Student Beans, and TOTUM offer deals and discounts across a range of categories, such as food, health and fitness, fashion, and travel. At the same time, when visiting somewhere or using public transport, always check whether student tickets are available. By looking out for student deals and discounts, you can save more money over time. If you go somewhere and you are unsure whether they offer student discounts, make sure to ask!
Reduce Your Monthly Bills
Students can take steps to reduce their water and electricity bills by being mindful of their usage. This can include small habits like turning the tap off when you brush your teeth, switching the lights off when you leave the room, and only running full loads in the washing machine and dishwasher. Put together a plan with your housemates on what you can all do to make a change and reduce your household bills.
Sell Things You Don’t Need
If you sell old clothes or items you don’t need anymore, not only does this declutter your space, but it also allows you to make some extra money. You can use online platforms to do this, like Facebook Marketplace, Vinted, and eBay.
Where Should Students Keep Their Emergency Fund?
Students should keep their emergency fund in a separate, easily accessible savings account. Once it’s in this account, it’s best to avoid taking it out until it’s really needed.
Common Mistakes Students Make
- Assuming saving small amounts is pointless: While at university, saving small amounts is more realistic than big amounts. If you’re consistent, that money will add up over time.
- Not budgeting properly: Without clear budgets to stick to, saving money can be more difficult. Make sure to look at your finances to see which areas you could be saving.
- Not keeping savings in a separate account: Putting your money into a savings account means you can earn interest on your money. Doing this also keeps everything separate, so you can avoid touching your emergency fund until you really need it.
Save Money and Build an Emergency Fund With The Student Energy Group
At The Student Energy Group, we’re committed to helping you save money and reduce bill stress so you can focus on enjoying university. As a trusted student bills company, we’ll combine all your household bills, including water, green electricity, gas, broadband, and TV licence, into one easy-to-split monthly statement. You can build your all-inclusive bill package with a few simple clicks. It takes less than two minutes to get a free, no-obligation quote from us today to start saving. We even plant a tree for every household that signs up with us!
