How to budget at university
Worried about getting through university on next to no income, or just keen to learn how to make your Student Loan stretch further? You're in the right place.
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74% of students in our National Student Money Survey 2024 said they wished they'd had a better financial education before coming to uni. So if you don't have a clue how to budget, you're definitely not alone.
We know, it's not the most glamorous of subjects. But the next few minutes you'll spend learning how to manage your money is basically a lifetime investment.
We've got a budgeting spreadsheet for you to download, a list of the best student budgeting apps, and a budgeting hack that could save you hundreds of pounds a year. Let's get cracking.
Student budget planning
Why you need a budget at uni
Budgeting might seem pretty boring (something your parents told you to do but you never quite got around to), but there are loads of benefits to tracking and controlling your spending.
Imagine your bank account is like a leaky bucket. Every now and then, a tap opens to fill it up – this is your income.
Annoyingly, your bucket is full of holes that are leaking your money. The water level will constantly be changing, but as long as there's always enough water in the bucket at any one time, there's no problem.
However, there is a problem if the water level gets too low. Then you have to start plugging those holes (your spending habits). And this is where budgeting comes in. It helps keep the water level consistent so you can continue to spend money on the things you need and enjoy (within reason, of course).
Whether you're trying to save up for a big spend like a summer holiday or a new games console, or whether you just want to be prepared for emergencies (we're talking broken laptops and smashed phone screens), a strong budget is exactly what you need.
Calculating your student budget
Here's how to plan your budget in four easy steps:
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Establish your income
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First up, you need to work out how much money you've got to play with. This will set the parameters of your spending, so think carefully about every possible source of revenue.
Remember that your Maintenance Loan comes in three big instalments throughout the academic year, or in monthly instalments if you're from Scotland. It's up to you to budget this out across that period.
Common student income streams
- Your Maintenance Loan
- Extra money from bursaries for students
- Money from your parents
- Salary from a part-time job
- Savings.
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Estimate your outgoings
Next up you need to figure out where all your money is going. You can either look back at your bank statement to add up all your previous purchases or simply input a rough estimate of how much you think you spend on each category.
Use our data on the average student living costs as a guide to how much you could be spending.
Essential student expenses
- Rent
- Groceries
- Bills
- Transport
- Course materials
- Study textbooks
- Specialist equipment.
Non-essential student expenses
- Nights out
- Alcohol
- Club entry
- Taxis
- Takeaways
- Eating out
- Hobbies
- New clothes
- Gym membership
- Haircuts and other beauty expenses
- Subscription services
- Travelling
- Gifts and charity.
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Calculate your weekly budget
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Once you've got all your expenses laid out before you, it's time to break it down into a weekly budget. Brace yourself, as this is where it starts to get real.
- Work out your total income for a term at university
- Minus your essential expenses for the same period
- Divide the number you're left with by the number of weeks in a term.
You've now got your weekly student budget. In other words, this is how much money you've got to spend on all those non-essential things each week.
For example, if your income across the first term is £3,000 and your essential expenditure adds up to £1,500, you would have £125 a week (across a 12-week term).
It's better to budget your expenditure per week rather than per month, as it's easy to go overboard at the start of the month and be penniless by the end.
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Set yourself some goals
If you follow the steps above and come out with a reasonable weekly budget, then great! But what if you're left with a tenner to live off each week or no money at all?
Whether you need to budget to get by, or you're trying to cut back, it's all about setting goals to either reduce your spending or boost your income.
You may realise you're spending £50 on takeaways each month, in which case you could try reducing it to half of that amount.
Or, if your gym membership is sucking up half of your Student Loan, then maybe it's time to try some cheaper ways of getting fit.
Best student budgeting tools
We've explained the basics of setting up a simple student budget, which you could easily do on the back of an envelope. But you'll get more out of this exercise by using one of the many free budgeting tools available:
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Student budgeting spreadsheet
Many students have told us that our student budgeting spreadsheet has been a lifesaver for them at uni.
This is ideal if you're not big on maths, as the spreadsheet will do everything for you. Simply plug in all of the money you have coming in each month, then log your expenses in the section below.
The spreadsheet will then do the calculations for you and track whether you're living within your means each month.
You can budget as you go, but it's also a great tool if you're working out whether your finances are going to fit your future spending. For example, if you're planning for the rest of the uni year or calculating if you can afford a holiday during summer.
The aim of the game is to keep your balance (the money that's left after you've accounted for spending) in the black. Ideally, you'll have a few quid left over each month to squirrel away or use to treat yourself.
If you find you're overspending or it looks as though your budget won't match your expectations, you'll need to find ways to bring it back in line.
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Student budgeting apps
Technology has made budgeting easier than ever. New banking apps can help you keep a close eye on your finances at the touch of a button.
Apps like Starling Bank and Monzo will group all of your purchases into categories (food, entertainment, etc.) and send you real-time push notifications when you're heading over budget in each area.
Some of these apps also have savings features that help you to set aside small amounts of money each week, as well as traditional banking functions like overdrafts, in-credit interest and joint accounts.
We've reviewed and ranked the best banking apps so you can see which ones would be most suitable for you.
Automatic savings apps and bots are also great tools for setting aside some money each week, without even having to think about it.
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Student budget calculators
There are dozens of free online budget calculators. They tend to be more simplistic than a spreadsheet and harder to save or edit as you go.
We've reviewed some of the better budget calculators and tools in our supporting guide.
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The standing order trick
This one isn't so much of a tool, but a super easy and useful trick that could help you save hundreds of pounds a year.
The idea revolves around the psychology that you'll only spend what you can easily access.
Here's how to do the standing order trick to help with your budgeting:
- Step One – When you receive your Student Loan (or any other income stream) into your student bank account, transfer it into a separate current or savings account (free to set up).
- Step Two – Set up a recurring payment (such as a Direct Debit or standing order) each week to transfer your weekly budget into your normal spending account. This is easy to do with internet banking, and will gradually feed the money you need into your account, preventing you from going overboard when you first get paid.
- Step Three – If you ever need more cash during a week, you can simply transfer some more money manually, but at least you'll be thinking about whether you really need it first. Not only does this give you a (sort of) weekly payday, but it helps to break bad spending habits and ensure your money will last until you're next paid.
Find out more about creating a budget in this video:
15 ways to make your money stretch further
Here are a few practical savings steps to help you manage your money:
- Ask yourself if you want or need things – Spend your money on the stuff you need first, and save the ‘wants’ for special occasions.
- Cut out non-essential purchases – Stop buying the everyday money-draining habits (we’re talking coffees, cigarettes, takeaways…) that eat into your finances.
- Get as much Student Finance support as possible – Make sure you’re getting all the Student Finance that you’re entitled to, including any grants, bursaries or scholarships up for grabs.
- Set weekly allowances – Give yourself maximum spending limits for your regular outgoings, such as going out or food shopping – and stick to it. If at the end of the month, you’ve underspent in one area, you can carry that over to the next month, or use it to supplement your budget in another area for that month.
- Take out a set amount of cash – To make it easier to track your daily spending, you can take out money at the start of the week and use that instead of paying by card.
- Put away money as savings – If you can manage it, transfer some of your income into a savings account or ISA at the start of each month. Then, if you make it to the end of the month with cash to spare, squirrel that away for a longer-term spend instead of blowing it on a quick fix.
- Recycle everything – If you’re done with something, and it’s still usable, sell it or swap it for something else. Likewise, never buy new if you can get it just as good from someone else for less. This works for clothes, furniture, textbooks, you name it.
- Switch bank accounts – Never stick with your bank account just to be loyal. Some banks will even give you a cash incentive to switch.
- Get cheaper bills – Look around for deals on your bills like gas, electricity and broadband. You could save some money by switching to a cheaper supplier.
- Open a second bank account – Get another bank account for any lump sums you receive (maybe your loan, grant or some inheritance money perhaps) and set up a Direct Debit so it drip-feeds into your current account in small doses. This way, you won’t overspend when a chunk of cash comes in, but you’ll still benefit from a little bit of extra money each month.
- Plan ahead – This does wonders for your bank balance. Thinking ahead applies to weekly meals, nights out and even the odd occasion when you decide to eat out. As often as possible, try to know what you’ll be doing and when so you can plan ahead and budget accordingly.
- Treat yourself now and then – To budget effectively, you don’t need to live like a monk 24/7. It’s important to still have fun and do the things you love. Just plan ahead for splurges so you’re never left with any nasty surprises on your bank statement.
- Earn a passive income – You can also try out a few of these hacks for making money in your sleep. You won’t see your bank balance shoot up immediately, but over time you’ll start to see a profit. It’s basically free money!
- Find the best deals – Join our Telegram group and sign up for our weekly newsletter, and we’ll do all the hard work for you.
- Be your own person – Don’t concern yourself with how much money your friends are making or spending. Stick to your own budget and keep your eyes on the prize. It’ll pay off eventually, we promise.
Now it’s over to you! This all probably sounds a lot scarier than it actually is. Once you get into the swing of things, you’ll find watching your bank balance slowly increase weirdly addictive, and you’ll eventually stop caring about splashing out on luxuries every other day.
Wish you’d been taught how to budget in school? Here are the vital money lessons you might want to swot up on.
