Student finances ‘can get out of hand’

With the new academic year approaching for students up and down the country, now could be the perfect time for youngsters heading off to university to brush up on their money management strategies.

Research published by Gocompare.com has revealed that while just over half (53 per cent) of current students believe they manage their finances responsibly, this leaves almost the same proportion who could improve their fiscal sense.

Indeed, the price comparison company's findings highlighted the most common reasons for student finances getting out of hand, with spending too much on nights out (29 per cent) the most popular reason given for overspending.

This was followed by spending excessive amounts on takeaways and ready meals (28 per cent), clothing (25 per cent), impulsive purchases (20 per cent), lending money to friends (18 per cent), failing to properly budget (17 per cent) and not holding the right student bank account to meet their needs (14 per cent).

Responding to the results, customer insight manager from Gocompare.com Claire Peate commented that for many students, heading off to university will be their first taste of true financial independence and it is therefore important youngsters quickly get to grips with the pressures of proper money management, although it is inevitable that some will make mistakes.

"If you find that your spending exceeds your budget – don't bury your head in the sand. Ignoring letters from your bank or credit card provider will only make matters worse, as charges for unauthorised spending can be punishing," Ms Peate concluded.

"Talk to your bank or credit card provider because you'll usually pay less in fees and charges if you formally arrange for your overdraft or spending limits to be increased."

Furthermore, respondents to the research also gave some handy tips to students currently concerned about their finances, with budgeting, shopping around for the best deals, avoiding using credit cards and being open and honest with their parents about their finances some of the best tips offered to help to keep money issues under control.

Posted by Joe White