By Laura Toffolo
This is Talk Money Week, the annual campaign that urges us to be more open about our finances.
This year it has a particular focus on young people, so I’ve been reflecting on my own first experience of financial independence, which was when I became a student.
Sadly, our schools aren’t always great at giving pupils the skills to manage their finances - that was certainly the case with yours truly – so we often learn to manage money through experience. And with freshers’ week now over and classes in full swing, many students will be finding that managing their finances is a challenge.
So, I’ve come up with five bits of advice that I wish I’d had when I was a student. I can’t claim it’s rocket science. Just some stuff that might make a difference if you are finding the knack of personal finances hard to master.
Hopefully there are some students reading that will find this helpful. If not, a few parents, aunts and uncles who can get busy with the scissors or the ‘share’ button and pass the info on to their cash-strapped kin. So, here’s my five essential tips for student solvency. First of all, make a monthly budget. Actually, this one should really be entitled ‘advice I wish I had taken’, rather than ‘advice I wish I’d had’! The morning before saying our farewells in a busy student halls carpark full of excitable freshers and their tearful parents, my mum sat me down to write a budget. Safe to say, money matters weren’t the first thing on my mind, and it wasn’t long before I was calling my mum for a refresher on budgeting 101.
But making a budget really will help you. It’s actually quite simple, and evidence shows young people are pretty good at it. Make two lists: one for your monthly income and one for ‘essential’ expenditure. Your income will include your wages, benefits, money from family members, your student loan and any bursaries. Then do the expenditure column. Start with ‘fixed expenses’ like rent, bills, subscriptions and any debt repayments, and then add essential purchases like food and toiletries. Then simply subtract your expenditure from your income. What you’re left with is your monthly spending money. If you can, put aside some of this money each month for emergencies – you never know when you might need it.
Second bit of advice: apply for Council Tax exemption. Anyone undertaking a specified full-time course at college or university for 21 hours or more per week for at least 24 weeks of the year can apply for full exemption from Council Tax. That’s well over a thousand pounds a year. It isn’t given automatically – you need to apply for it. Fortunately, I was blessed with extremely organised flatmates throughout university who did this for me, but you may not be so lucky. So, get on to your local Council’s website and find out how to apply for Council Tax exemption.
Third, save on your energy bills. Sure, energy’s expensive – but it needn’t cost the earth. Checking you’re getting a good deal normally only takes a few minutes and doing this regularly is a great habit to get into. You can also save money by using energy more efficiently. So, remember to close those curtains when it gets dark, switch your appliances off at the socket, and try not to spend all day in the shower. Oh, and if you’ve got storage heaters, speak to your supplier to learn how to set them properly.
Fourth, know all the ways that students can save money. There’s a wealth of discounts available to students through Unidays, Student Beans and Young Scot. So, before you make any big purchases, check to see if there are any discounts. I promise you, you’ll miss student discounts when you graduate. Use them while you can.
Most universities and colleges also provide ‘discretionary funds’ to support students who are in financial difficulty. Each institution determines its own eligibility criteria for these, so just ask your university or college for this information.
And if you are aged 16-25 and have a disability, you may be eligible for up to £4,000 from the ILF Transition Fund, which aims to help you participate in activities that you may otherwise be unable to take part in, such as a hobby or gaining a new skill.
Plus, you may also be entitled to social security benefits. It’s a myth that students are exempt from these. You can use our online moneymap.scot tool to check if you’re receiving all the funding you’re entitled to, as well as to find out more about whether you could save on your utility bills.
Fifth, and last – but not least, know that there’s support available. If money problems are getting on top of you, whether you’re worrying about debts or are struggling to get by on the money you have, your local Citizens Advice Bureau is here to help. You may benefit from more personalised advice than a top tips article in the Herald can provide. Our advisers offer a sympathetic ear as well as practical support, and our advice is free, confidential and available to everyone.
Above all, I really hope that you enjoy your time as a student. Higher education provides so much more than better career prospects. You’ll make new friends, you’ll gain expert knowledge on the subjects that inspire you and explore a host of other interests through involvement with societies and extra-curricular activities. Having a sound financial base will help you make the most of these opportunities – which is why we are here to help.
Laura Toffolo works in the Financial Health team at Citizens Advice Scotland.
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