Receiving your first pay cheque or student loan instalment is often an exciting time. It might be tempting to spend everything at once without considering your financial obligations, but doing so could have significant consequences, including landing you in tremendous debt.<\/p>\n
Instead of impulse spending, creating a monthly financial plan can help you prioritise your essential costs and decide how to utilise any spare money. You\u2019ll thank yourself later for learning how to balance saving for your future with splurging on the occasional treat.<\/p>\n
Ashley Tate, chief executive officer at online student bill-sharing tool Split The Bills<\/a>, said: \u201cSeeing your spending habits written down can be a wake-up call. If your budget amount outweighs your income, something needs to go.\u201d<\/p>\n Organise your finances<\/strong><\/span> Claire Roach, money-saving blogger and owner of Daily Deals UK<\/a>, said: \u201cEvery student I know has blown most of their loan on holidays, nights out and new clothes. The best way to avoid this is to plan your budget in advance.\u201d<\/p>\n Once you leave university and start earning an income, putting together a money management plan can help you keep track of where your money goes. This will make it easier to subtract costs such as rent, bills and student loan repayments from your salary and calculate a more accurate figure of how much is left for the rest of the month.<\/p>\n Dennis Harhalakis, founder of Cambridge Money Coaching<\/a>, said: \u201cMost of it is common sense and maths, but budgeting is also an emotional process which can be challenging. It\u2019s also difficult if you\u2019re flat-sharing with friends or a partner who might have different views and priorities.\u201d<\/p>\n Be aware of your utility costs<\/strong><\/span> To prevent this from happening, you could open a joint account so that everyone can check outgoings – but only do this with trusted and financially-secure people.<\/p>\n Ashley added: \u201cIf you share a joint account with someone who has bad credit, makes late payments or if the account goes overdrawn, it could impact your credit score. This could stop you from getting a mortgage or even a mobile phone contract in the future.\u201d<\/p>\n Alternatively, you could use a bill-splitting service that puts all utilities into one monthly payment per person.<\/p>\n \u201cIf you find it difficult to keep on top of numerous different bills, only having one cost to consider makes budgeting much simpler,\u201d Ashley continued.<\/p>\n Build towards saving goals <\/strong><\/span> Caroline Domanska, income strategist and founder of Money Mindset Coach<\/a>, said: \u201cI\u2019d look at all the things that are important to you in the short-, medium- and long-term and allocate some money to each.<\/p>\n \u201cEven if it feels impossible, if you start with something\u2014even \u00a325\u2014it opens the door and allows you to work on a plan to increase these contributions over time.\u201d<\/p>\n
\nLosing control of your finances is easy when you don\u2019t keep track of your regular outgoings. Research by NatWest<\/a> estimates 42% of students don\u2019t use any budgeting methods, while 6% don\u2019t consider what they\u2019re spending at all.<\/p>\n
\nIf somebody else in your household handles bills, it\u2019s easy to become oblivious to the exact cost of utilities. But by failing to budget for the correct amount, you\u2019re likely to overspend.<\/p>\n
\nAfter organising your essential costs, decide whether you want to save for future events such as a holiday, house deposit or wedding.<\/p>\n