Students may be not so clever when it comes to their money – which is bad news for those currently facing Freshers’ Week.
More than 1.6 million of them lack confidence in their understanding of personal finance, reckons the money-management expert Blackbullion.
The site warns that the knowledge gap could lead people into financial difficulties. Its research showed, for instance, that three out of five students don’t understand the repayment terms of student loans.
Meanwhile, almost half of students go to university with no savings to fall back on and 15 per cent actually turn up for higher education in debt. They’re in for a shock. New research published today reveals that students on a three year course now face a total cost of more than £54,000 – and that excludes student loans.
The amount has climbed 7 per cent since last year, according to Santander. The bank’s research shows that tuition fees remain the biggest annual cost, at £8,601 per year. But accommodation and bills at £4,169 also account for a sizeable chunk of cash, while students will spend an average £1,302 a year on food and £943 on transport.
New under-graduates need to wise up fast and learn how to budget. That means working out how to make student loan money last for three months, rather than blowing it all in one go.
One of the most important lessons they need to learn is financial management. Steve Pateman of Santander points out: “Going to university is not cheap so students need to have a firm grasp of budgeting to make their money stretch as far as possible.”
There are several things students can do to help stretch their money. For starters they should seek out bargains, not least by using their the discount deals offered on the NUS Extra card, such as 10 per cent off groceries at 2,800 Co-operative Food stores.
But the key thing they need to learn is to say no to offers of easy credit from banks or predatory payday lenders. Students will have enough worries over the next few years without adding unmanageable debt to their woes.
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