Published: 09th April 2017
Here are some practical strategies to help you plan finances as a student
Tarun Anand, the founder of Universal Business School, talks about how to implement financial planning in a student’s life
Stepping out of the sheltered environment of a school and a comfortable life at home under the guidance and support of parents marks a major turning point for every student entering a university. Just like every other phase of life, it is not the academic and theoretical knowledge alone that we gather but also incur several practical real-life experiences during the course of time and thus, have our respective takeaway lessons from them. Becoming financially independent in terms of handling your own expenses and allocating a suitable budget for yourself, is one thing which comes across as both a responsibility as well as a feeling of growing up as an adult.
It is imperative to create your own financial plan as a student in the very beginning itself. Systematised financial planning will not only assist you to manage your expenses well but will go a long way in letting you strike the right balance in your new independent life. Even though, it may seem like a petty issue, planning an appropriate budget is certainly a necessity for every student to facilitate wise decision-making. Particularly for those going to a different country for higher studies, this is a matter of concern as almost all universities include an estimated financial plan structure vis-á-vis the available resources as a mandate to be submitted by every such student before the admission.
Think Smart: Categorise your expense as a student
Here are a few substantial points to be considered while creating your own financial plan:
Allocate a priority-wise budget — While creating a suitable budget in accordance with the available financial resources is a must, it is even more critical to ensure that the budget you set matches correctly with your set of priorities. For instance, your budget allocation for basics such as books and food ought to precede the expense amount for luxuries like eating out or vacationing with friends.
Monthly categorisation — Again, this is an extension point of prioritisation of your expenses, wherein you as a student should categorise your expense into varied buckets like essential, non-essential, immediate or eventual and those which can be reduced by pooling in together with friends. This kind of strategic assessment and pre-planning of expenses can also help to keep the budget stable and refrain from getting oneself into any difficult situation.
Limit your credit — Though, credit cards and other credit options are a great saviour in today’s era and more so for students, they are also spoilers and often lure one into getting under unnecessary expense and then, debt. It is vital to set a monthly credit limit for yourself and yet, try to have minimal opportunities for relying on it. Rather, one must curtail some of the miscellaneous expenses to limit the credit, if need be.
Lastly, create a secret wish list of things you would like to buy for yourself but are unable to accomplish at the moment due to limited finances. This list will not only motivate you to stick to your budget but will also serve as a constant reminder of the prize which you will fetch by going the saving route.
There are numerous banking services available so it is critical to have complete knowledge about the relevant solutions and what works best for you