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Spend and Save Smart: Top 10 Hacks for Students Living on Limited Pocket Money

Learning to be economical not only saves money but also helps students learn about discipline, fund management, and investments.

BY KRITIKA BHATIA

PUBLISHED FEB 3, 2024

Use a credit card when it’s essential. Pexels

10 savvy tips for students who struggle to save their pocket money

Students must keep in mind these tips to efficiently save their pocket money and enjoy rest of the month| Pexels — Students having a good time | Pexels

Students usually have limited pocket money and managing daily expenses on a tight budget often proves strenuous. However, learning to live on a small budget also helps students learn how to save from a young age. Learning to be economical not only saves money but also helps students learn about discipline, fund management, and investments, and be independent and liable for their own decisions. Here are some quick tips that can help students enjoy their student life and also have some savings at the end of the month.

1. Create a budget

Creating a budget is crucial not only for saving but also gives you an idea of your spends and sets a limit to that|Pexels — Creating a budget helps keep track of expenses | Pexels

Create a budget of your pocket money by listing all the necessary expenses and what can be avoided. This does not mean that you cannot spend any amount on yourself or give your friends a treat. It is just a way to track your expenses so that you are not empty-handed halfway through the month. Also, if you make categories and allocate an average amount to each category, you will be able to save a good amount and also enjoy your whole month.

2. Buy only what is essential

Making clear expectations of needs and wants is essential|Pexels — Making clear expectations of needs and wants is essential | Pexels

Most students confuse their wants and needs and end up overspending. It is crucial to distinguish between your needs and desires which can be avoided or postponed. Make a list of 'needs vs wants' and see what you can discard for the month and you will see how much money you will be saving at the end of the year. For example, meals, bills, house rent, and college fees are some of the necessities that can't be avoided. On the other hand, you can save up for parties, shopping, outings, and gifts instead of splurging your money on them.

3. Try home-cooked meals

Home cooked meals might not taste like outside but are healthier and economical option|Pexels — Home-cooked meals are healthier and economical | Pexels

Students or people living away from their homes in shared or rented apartments and hostels, cooking meals daily can save you a huge lot of money and prove to be a healthier option that also cuts down on your medical bills. If you live in shared accommodation, you can easily split your cooking responsibilities with your roommates and enjoy hot, nutritious, economical meals at home.

4. Discover second-hand options

Prefer going for second hand options which would not give you an extra expense burden|Pexels — Go for second-hand options when it comes to objects of daily use | Pexels

Second-hand options do not mean using old and depreciated items but keeping a lookout for quality second-hand items at lower prices. It is the best option for students and people living on rent. You must consider second-hand furniture, home accessories, electronics, and books which are easily available for purchase on websites such as eBay, Craiglist, ThredUp, Furniture Row, etc. Such buying practices will help you save up for the occasional treats you wish to give yourself or others.

5. Set a savings goal

Savings and investments are a crucial part of anyone's life keeping in mind the inflation and uncertainity|Pexels — Savings and investments are a crucial part of anyone's life, especially during inflation |Pexels

Young adults must have a clear vision of their savings every month so that they meet their 5 or 10-year savings goal. One must also invest their saved money somewhere as money just lying won't yield interest. Investing in mutual funds and stocks will help young adults reap profits. Several apps such as Ally Invest, Betterment, E-Trade, and eToro help you set your savings goal and invest accordingly.

6. Limit impulsive purchase behavior

Students must control their impulse and not spend way too much extra on their desires that makes them look cool|Pexels — Students must control their urge to buy items that make them look cool | Pexels

It is quite easy for you to splurge on items that might appeal to us at the moment when we go out. Online distractions or temptations abound today, so we don't even have to go out to make an impulsive purchase. When planning to buy an item, be it online or offline, think wisely: Do you really need it or are you tempted to buy it because it might make you look cool? Controlling such urges to purchase can help you significantly cut down on unnecessary expenses and stay within your monthly budget.

7. Save on transportation costs

Try using public transports or renting a bicycle or you can even go to school or college by walking if the distance is not much|Pexels — Try using public transport, renting a bicycle, or walking to school | Pexels

Transportation costs are something that can easily burn a hole in your pocket. Be mindful of the transportation options you consider while going out. When you need to go for short distances, try to walk or maybe take a bicycle. For traveling larger distances, instead of Uber or other chauffeur-driven cab services, try public transportation such as local buses or the subway. Public transportation can be quite economical and it also gives you an opportunity to connect with others.

8. Share the expenses

Sharing at parties and outing can be of great help. Contribution amongst friends is one of the best way through which everyone saves|Pexels — Sharing at parties and outings can be of great help | Pexels

One interesting facet of student life is that you get to live and share a strong bond with your friends. When living together, there are many expenses that can be split among friends and roommates. Expenses on transportation, laundry, groceries, accommodation, shared appliances, and many others can be equally divided among the friends who are co-consumers. This way you and your friends learn to be accountable for the spending and nurture bonds that sustain for a long time.

9. Leverage student discounts

Take help of student coupons and discounts which are available at several shops, cafes, book shops|Pexels — Avail student coupons and discounts which are offered at several stores, cafes, bookshops | Pexels

Students get loads of discounts for different services when it comes to shopping for electronics, clothing, or even air travel. There are many vendors offering loads of discount codes to students so that they choose their products. It helps these vendors create a pool of loyal customers for the future. It works well for cash-strapped students who wish to save up as well.

10. Don’t fall for credit cards

Credit cards is a facade for students and some adults believe that if you want to save money don't go for credit cards. As with them you don't have idea of how much you are spending|Pexels — If you want to save money, be careful with credit cards | Pexels

Credit cards can be a big trap, not just for students but even for old folks. When shopping for any goods or services, try not to make a purchase with a credit card. Credit cards give us the power to buy items even when we don’t have the money to pay for them. They can put us in a vicious cycle of debt, which can eat into our future earnings and ruin our peace of mind. Make thoughtful purchases with the money that is at your disposal. Use a credit card when it’s essential and only take loans that you can pay back quickly without any stress.