We could all do with a bit more money. And it’s probably doubly true for the average ACCA student trying to study in the evenings while holding down what might be their first junior position.
It may be a cliché, but failing to plan is planning to fail, says Dan Baker, general manager EMEA at Student.com: ‘When budgets are tight we can often become focused on the monthly incoming versus outgoings, which is fine until that rainy day arrives and you have to pay for a large expense. Working out costs that happen less frequently – such as dental check-ups – and splitting them across a few months will mean you will be prepared for the outgoing cost when the time arrives.’
As for emergency costs, Baker advises putting aside a small amount to help soften the financial blow. ‘Planning can often provide some peace of mind, which will allow you to focus more on your studies rather than money worries,’ he adds.
For Jessica Exton, behavioural scientist at ING eZonomics, much of our day-to-day spending is a habit, and if you want to be financially independent you need to think about how much you earn and how much you can spend on different areas of your life.
‘Knowing where your money is going is the heart of budgeting,’ she says. ‘If you’re finding it hard to keep track, you could download an app that alerts you of payments. Or you could use old-fashioned pen and paper if that’s more your style. Once you know where your money is going, you can ask yourself why it’s going there and if it should.’
Exton also believes it’s easier to manage money when you have goals – and not just achievable goals, but exciting and personal ones too. ‘It’s easier to save up when you have an emotional attachment to your goal,’ she says.
As for making your money go further, you need to invest some time in shopping around for everything, says Jamie Smith, chartered accountant and tax adviser. ‘This means being organised. Note down when policies or contracts are up for renewal and give yourself time to shop around and/or negotiate a better deal for the next year,’ he says.
‘If impulsive spending is something you struggle with, then build it into your budget,’ says Smith. ‘Allocate yourself a proportion of your wage that you can “just spend” on whatever takes your fancy. The tricky bit is sticking to the amount you’ve set.’
Even the most common sense things can make a surprising difference, adds Smith.
‘Make a meal plan, write a list of exactly what you need for those meals and then just buy what you need,’ he says. ‘It’s very easy to become a habitual shopper, where you just fill your trolley with the same things. This is even easier with the “select previous list” option online. Which is fine, if you actually use everything you buy. But if you find yourself with a weekly “bin the salad drawer” ritual, then it’s probably time for a rethink.’