JUST weeks from now, many young adults will be getting their first taste of financial freedom as they head off to university.
For many, it will be the first time they have lived away from the family home – meaning they’ll have the new experience of bills and budgeting.
While this may seem daunting, it’s also a chance for your children or grandchildren to develop good money habits that could help them in later life.
Here are some tips from Rachel Springall, a finance expert at Moneyfacts, to get students started.
Pick a suitable student account
Starting off with a good bank account can help students over their years of study. Applying for a generous interest-free overdraft could be a lifeline, but you must be able to pay it back later.
By budgeting their way through their course and keeping a tight rein on spending, students will hopefully still be left with some money at the end of the week for shopping or socialising.
Little changes like making a coffee at home, or even lunch, can make a huge difference after just a few weeks.
Save the change
Each time students buy something they could save the change and watch their savings grow. For example, with Lloyds Bank, when customers are in credit, purchases may be rounded up to the nearest pound with the difference put into a separate account.
Make the most of saving apps
One of the free apps around that could help students save without even thinking is Chip. The app works out how much money users could save and will go one step further and move this money into a separate account, so students need do very little to save.
Check your bank balance regularly Living away from home means overseeing daily expenses, so checking payments on the go using mobiles or tablets will be very practical.
Stay up to date with your credit score
At some point, students may look to take out a student credit card, or get a mobile phone contract.
There are various agencies to approach to check a credit score first, such as Experian, Equifax and Callcredit. Providers can ask one or more of these agencies for data to assess applicants, so it’s important to check your credit score regularly.
Review utility bills
It’s easy to be laid back when it comes to bills, but you should always be on the lookout for ways to save money by switching provider and not just taking their current offer.
It’s also important for students to ensure their housemates understand the monthly costs and the importance of paying bills on time.
Keep an NUS card handy
An NUS card gives students access to many places that offer discounts, so they should remember to keep it with them. When eating out, there may be even greater discounts, so students should consider this when searching for a place to eat.
Protect possessions with insurance
Consider taking out cover for gadgets and other contents just in case. It’s quick and simple to get a quote online, and students can pick a plan that suits their needs so that it covers their valuable items.