Written by Tracey Blake
We’re hoping that you are earning while you’re learning with a fun, flexible, well-paid job as a Student Nanny – but how to manage those all important pounds when they drop into your bank account? We asked finance guru and CEO of Squirrel (the start-up making waves in the fin tech world) Mutaz Qubbaj for his top tips:
Set a plan!
The truth about money is – when you’ve spent it, it’s gone. The scary truth about money is – most people don’t know where it’s gone until it’s too late.
So, make money one less thing to be scared about by setting a plan for how you want to spend it. I’d start with the biggest tickets first – rent, food, utilities, travel card, mobile, fuel money – that should cover about half your spending for the month. Then move on to the smaller tickets like that Spotify, Netflix or gym subscriptions.
Congratulations! You’ve flagged the essentials and you should do what you can to set this money aside until it’s due. Possibly even lock it away or have the bank of Mum and Dad hold onto it! Now that you’ve got a plan, the trick is to stick to it.
Discounts! Discounts! Discounts!
You’re a student and what that means is that if you’re within throwing/walking distance of somebody selling something you need, you can probably get it at a discount. This applies to everything from public transport to buying food and even that haircut you’ve been putting off for too long! So have your student ID ready wherever you go and ask for that student rate.
Ditch the Uber! (or at least split the fare)
With so many cheap ways to get around town, you’re paying up for pure convenience whenever you lock that ride in. With discounts on student fares on buses and trains, you’re paying a hefty premium when that Prius pulls up to that blue dot on the map.
You can even use cutting travel costs as a way to get fit if you’re adventurous enough to brave biking the streets. With bike bays literally everywhere these days and free-standing bikes with automatic locks, you might want to get a start on that new year’s resolution to get fit by biking around town.
And if you do get an Uber, sharing is the way to go (look for the “split fare” button on the menu) – it’s cheaper if you can ride with friends.
Cash is king!
How many times have you heard the words “no pain, no gain”? Well this also works when it comes to spending! Contactless and debit cards have made it so easy to spend money you do and don’t have. That’s pretty much how they make their money (think about overdrafts and interest on credit).
Carrying cash may be an old school solution, but carrying and spending the cash you have allows you to notice where and how you’re spending money because it is actually leaving your hands rather than disappearing off your debit or contactless card.
You can easily see how far your money truly takes you. Try carrying your weekly spending money in cash to see where, or even how fast, money travels.
Plan your spending before you’ve even left the flat!
Temptation and easy spending are a killer combination when it comes to your bank balance! A sure-fire way of making sure you spend only what you want to (and ideally what you need to), is setting a plan for what you want to buy before you’re in a spending situation.
With holidays just around the corner and sales everywhere on the horizon, this is even more important as the temptation to splurge on that extra pair of shoes, a new gaming console, a new wardrobe or going overboard with gifts is hard to resist during the season of giving. So, plan out what you want to buy, do your research and look for a few price points online, and then off you go.
Use an App to make it a bit easier
Here are a few suggestions:
“Jam Jar Budgeting accounts” such as Squirrel or ThinkMoney. Squirrel has a weekly spending feature that allows you to pay yourself a weekly allowance so you don’t spend all your money at the beginning of the month. It also sets aside money for important bills and seasonal events such as Christmas, birthdays and holidays. Think Money segregates money for bills to help people avoid bounced direct debits and the charges associated.
“Lock your money up” using apps such as Money Lockup launching Wednesday 29th Nov. This lets you lock up your money in a physical location you have to travel to in order to access it. Choose a steep hill, your nan’s house or somewhere really far away if you really don’t want to be tempted to spend it. Alternatively there are a number of Fixed term savings bonds that don’t let you withdraw money until the end of the term.
“Micro-savings” Apps such as Cleo and Plum which plug into your bank account and either round up your spending and put that into savings, or they try to figure out when you can afford to save small amounts.
“Account Information Aggregators” such as OnTrees and Moneydashboard who will show you how you spend your money by screen scraping your online banking. These tools show you where you’re spending your money in a nice visual way.
“Spending Cards” such as Pockit and Loot – these are prepay debit cards you load your spending money onto so you can only spend what you plan to spend. They also help you visualise and keep a track of where money is going.
Good luck you can do it – make 2018 be the year that you get your finances sorted!
Mutaz Qubbaj is CEO of Squirrel, an easy-to-use personal finance management application that does all of the budgeting for you, where you have access to your money right when you need it.
Connect with Mutaz on LinkedIn