Jasper Plan
Financial issues as a student? Let me guess: it’s the start of a new month, you’re already out of money and can’t afford to pay your bills and rent? While some students are amazing with their finances and can easily find the right credit cards for building credit to put them in a good position when they leave college, many of us face the problems caused by the infamous tight student budget. Keeping our expenses under control may seem difficult at first, but pursuing a self-regulated and well-managed strategy may help to prevent overspending and careless investments. If you’re lucky enough to have helpful parents that will bail you possibly through some equity release. If your parents are open-minded to the idea consider showing them a free calculator to see if it could be feasible. But I digress.
(a) Budget
First of all, it is essential to know what you have and how you’re spending it. Software programmes, such as Excel, can help us calculate monthly net incomes, expenses, as well as analyze our annual budget per month. I’m not telling you to go on Excel immediately, but I am rather underscoring the importance of jotting down your expenses to provide a sound insight towards your financial situation. You could try collecting all your receipts for a whole month in order to get a good idea of this.
Once this is done, you can focus on downsizing your costs. Look at each category separately, and notice the difference in the elasticity of each good. In other words, it is harder to squeeze money out of some goods than others which are higher up on the priority list.
(b) Food
Take food and non-alcoholic drinks for example. You can achieve massive cuts in expenditure on these items, by sticking to Spar’s €3 chicken fillet rolls or supporting the Irish economy by living off Dunnes’ 2 for €6 deals on meat. However, eventually, you will reach a limit that can no longer be compressed. Transportation costs, on the other hand, can be cut completely. Instead of spending eighty euro per month on taking the bus to Trinity or around Dublin, why not walk? Or buy a bicycle? Not only is a bit of exercise healthy, but you will find that it lowers your costs as well.
(c) Day-to-Day
The reduction of other expenses, such as phone and utility bills, requires a reshaping of strategy. Instead of spending €30 every month on your phone contract, spend €20 on the pay-as-you-go model which includes free texts (or calls to your network) for a whole month. Also, instead of using your own shower after visiting the gym, and thereby adding to personal utility costs, use Trinity’s facilities. This also applies to books. Long reading lists affect all of us, students. Yet, why buy books when they are available in the library? If absolutely necessary, buy them from Amazon at cheaper prices or second-hand copies, which you can find on the “noticeboard.”
(d) Nights Out
Careless investments are what you want to avoid. Investing in items that don’t maximize utility and aren’t high on the priority list painfully cut our budgets. For example, annual expenses on the morning coffee could add up to around €500, or in other terms, a decent month’s income. The same idea can be applied to alcohol. Why buy expensive drinks at clubs, or order pricey pints at the pub? If you find it necessary to drink, do it at home before going out and buy the “cheap stuff.” And if you’re someone who doesn’t drink alcohol, sticking to drinks like DRY apple bubbly, cordial, fruit juice or fizzy drinks could save you more money than it would if you buy alcohol every time you go out.
Living off inferior goods is a key economic principle for people with lower incomes. Think twice before going to the supermarket: which one has the best offers and lowest prices?
(e) Banks
Furthermore, it is critical to be well informed about the student rates and policies of the various banks before choosing to stick to one. A lot of you might have chosen Bank of Ireland, for example, because of the free flight vouchers they would give you at the beginning of term. However, the overdraft policy plays a big role in student banking. Go bank shopping. Find out how much money you are entitled to in your overdraft in order to prevent additional charges and fees. Speaking of overdrafts, if you have had an overdraft or a credit card for a number of years now, but you feel like you are overpaying, it may be best to request a ppi call back, as you could have been mis-sold. It is best to do this sooner rather than later, as there may be more of a chance of you claiming back the money you thought you had lost. As a student, money isn’t something you would turn down. Ulster Bank, for example, has a standard student overdraft of €650, which can be increased depending on which subject you study, whereas AIB offers a special 0% interest rate subject to a maximum of €1500.
On the whole, saving money and reducing expenditure requires thorough planning and is most effective in the long run. Making changes to your lifestyle is essential in order to improve your savings.
