Before going to university, many young people aren’t fully prepared for the financial responsibility of fending for themselves. According to the Student Money Survey 2016, a quarter of students are unsure of how to budget, while an astounding 80% worry about making ends meet while there. With tuition fees typically up to £9,000 per year, alongside living costs and other expenses, it’s common for parents to worry about how their child will get by.
The good news is that, not surprisingly, should students find themselves in a ‘cash crisis’, 72% of them would turn to their parents for help. But, how can you as parents help them to become more money savvy beforehand so they don’t need bailing out?
Start with budgeting
The first thing a student should do is determine exactly what the day-to-day costs of university will be. Working out in-goings and outgoings, such as wages, grants, rent and bills might sound obvious, but it’s an art many young people heading off to university haven’t yet mastered.
Instilling the basic principle of living within your means early on in student life could make all the difference to their attitude to spending in that crucial first few months away.
It’s important that they write it all down and regularly update and review their spending habits. Online banking provides access to transactional information 24/7 so regular monitoring will flag budgetary issues early and avoid any unwanted surprises. A simple excel spreadsheet is all that’s needed although there are Apps available that they might prefer.
Encourage money-saving behaviour
There are many ways students can save money on pretty much everything they need for university. Encouraging this thrifty behaviour will help them to become more financially aware, and could even grow their savings. By shopping around, they will also have more money to enjoy during their time away studying.
Money saving tips for students
- Take advantage of student discounts – invest in a NUS card and a Railcard
- Use cash, not card, to help monitor spending
- Shop around for utility providers and insurance using online comparison sites
- Download a money-saving app to help log spending
- Check if your study books are available in the library before buying them, and don’t forget to look for second hand versions - keeping them in good condition could generate cash if they sell them on to next years students
- Sign up to loyalty schemes, such as supermarket cards
Share your invaluable knowledge
As a parent, it can be difficult to know where to start when it comes to helping your children become financially independent. Alongside money-saving tips and support, introducing students to the perils of payday loans and credit cards could help them to further understand the future implications of financial decisions.
This support and knowledge, combined with managing the costs of university, will in turn, allow them to become more financially savvy and prepare them for the future.
How did you prepare your child for the financial responsibility of university? Tell us by joining in on the conversation via Facebook and Twitter.
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