Most students in the UK receive the first instalment of their maintenance loan at the beginning of the first term. A bank account full of money feels exciting, but without a clear budget or plan in place, it can also lead to overspending.
Why The First Term of University Can Be Expensive
Some people assume that the first term is only expensive for freshers, but it can be costly for second- and third-years too. Getting ready for a new year can involve buying or replacing items such as study materials, like textbooks and notebooks, as well as household essentials. Travel costs can also increase as students spend more on transport as they commute to campus or travel between their university town and home. Spending on social events tends to be higher during the first term, as students get involved in freshers’ events and catch up with friends they haven’t seen over the summer.
If students aren’t careful and don’t have a budget to stick to, they can get through their maintenance loan a lot quicker than expected.
How to Budget During Term One
Step 1. Work Out What Money You Actually Have for the Term
Add up how much you get each term from student finance, any part-time jobs or side hustles, and family support. Next, think about how much money you’ll need for essentials, such as bills, food shops, and transport. If you’re unsure, try basing this on previous spending. Many digital banking apps let you categorise your spending, giving you insight into how your money is usually divided. Once you’ve worked out the amount you have for essential expenses, you’ll have a better idea of how much is available for non-essential spending and savings.
Step 2. Break It Into Weekly Spending
Take the amount you have available over the term for non-essential spending, and divide it by the number of weeks in the term. This will give you a rough weekly budget for non-essential spending. However, weekly spending isn’t always linear, so it’s important to adjust your budget accordingly. You can do this by noting which weeks will be more costly, such as when bills come out or when social events are planned.
Step 3: Watch Your Spending Habits in the First Few Weeks
Track your spending at least once a week on your digital banking app; don’t just check it when you think it might be low. Doing so prevents costly spending habits from going unnoticed. If your first weekly budget didn’t fit well, that’s okay! Trial and error means you can adjust it accordingly.
Tips to Stay Financially in Control During Term One
Pause Before Making Non-Essential Purchases
We’ve all bought something impulsively, only to never use it again. If you often fall into this trap, try using the 24-hour rule. When you see a non-essential item you like, step away for 24 hours. The idea is to give yourself time to decide whether you really need it, rather than making a rushed decision. While it’s good to treat yourself, doing so frequently can lead to overspending.
Be Mindful of Small Everyday Spending
While buying a coffee on a busy study day or grabbing lunch on campus may seem convenient, small costs can add up quickly. Planning ahead means you can make better choices, such as having coffee at home in the morning or making a packed lunch to bring to campus.
Start Building an Emergency Fund
Having money set aside provides financial security, can cover unexpected costs, and reduces reliance on overdrafts. Even setting aside a small amount of money each week can add up over time. One mistake students make is using money they’ve set aside for non-emergencies. Once you’ve put money into your emergency fund, don’t touch it unless you really need it.
Make the Most of Student Discounts
Using student discounts is a great way to save money and help students stick to their budget. There are several student discount apps available that can save you money in different areas, from food and travel to entertainment, such as TOTUM, Student Beans, and UNiDAYS. If you’re unsure whether somewhere offers a student discount, always ask! Small savings can make a difference over time.
How The Student Energy Group Can Reduce Financial Headaches
At The Student Energy Group, we understand that students want to make memories at university and don’t want to be tied down by financial stress. As a trusted student bills company, we’ll combine all your utility bills, including gas, electricity, water, broadband, and TV licence, into one monthly statement that can be split equally between you and your housemates. You can create your all-inclusive uni bills package with a few simple clicks. Signing up with us means we’ll plant a tree as a step towards a brighter future. Get a free quote from The Student Energy Group today.
