Award-winning insolvency practitioner, Bev Budsworth offers a simple, 10-point plan for any student looking to sort out their finances and manage debt repayments whilst at university:
1. Don’t panic
• For young people and students in debt the most important advice is don’t panic – there is always a solution available for dealing with debt.
2. Talk to someone
• Talk to someone - either a friend or family member or a fellow colleague who has experience of a similar situation, who can give you advice on their own experience
• As a student, you will usually have a local student’s union available who will have staff on hand that are used to dealing with money problems. They may well refer you to hardship schemes, which can help tide you over until you get back on your feet. They will offer sound advice on how to budget and manage your money.
• You will feel so much better if you can share how you are feeling with someone. If you are unable to talk to someone at least write it down. You are doing something positive and this will help you feel more in control, reduce the feeling of panic and make you calmer.
3. De-clutter
• Get all your personal bills and bank statements together, sort them and put them in a file. An untidy environment creates confusion and a sense of loss of control. A thorough tidy out has a good feel factor – you will instantly feel more in command.
4. Exercise
• Going for a swim, walk or a work out in the gym will always make you feel far more able to deal with the more unpleasant aspects of life including debt.
5. Acknowledge your debt
• You need to take responsibility for your debt. It is easy to blame institutions for making credit to easy to obtain but it is your debt, your responsibility and you need to deal with it.
6. Visualise a life free of debt and embrace change
• Imagine what it would be like to be free of debt – your finances sorted, money in a savings account, no stress!
• Develop a practical plan that is gradually going to move you closer to the debt-free state.
• Remember if you do nothing, nothing will change and you will remain in debt.
7. Budget
• Work out exactly what essential costs you have each month (rent, food, bills etc) and then divide what you have left into weekly amounts. Try taking that amount out of the bank at the start of the week and sticking to it, rather than making numerous trips to the cash machine.
8. Don’t spend money you haven’t got
• Don’t be tempted to write cheques when you know you are up to your limit. The banks don’t take to kindly to this and will charge you £20 or more for the privilege of bouncing your cheque. Also, don’t take loans from friends to fund a night out – they may not be so friendly when you can’t pay it back!
9. Work sensibly
• 90% of students are now forced to work during their course just to keep their heads above water. Think about when you are likely to be most busy with exams and assignments and try to fit in more work hours in the quieter periods.
10. Take advice
• There are many organisations including the NUS, CCCS, CAB as well as other professional organisations that specialise in debt advice. So pick up the phone and call.