Money lessons for first-time students

LEAVING Cert students get their exam results tomorrow and, for many of them, this begins their journey into third-level education.

Money lessons for first-time students

It’s an exciting time, but also expensive. Students and their parents should be aware of the costs and plan carefully.

Advice for students

  • Open a student current account. All the banks offer fee-free banking to students. Many offer interest-free overdrafts and have credit cards for students. Think carefully about whether you will use one or both of these, and discuss it with your parents. It is great to have access to funds for emergencies, but everything must be paid back and you should stay within your budget. If you use an overdraft or credit card, do so carefully and repay it as early as possible. See the limit as just that — the maximum possible, not a target. Many students build up credit-card debt and are then unable to pay it. In addition to the interest charges, you may also damage your credit rating, which can have repercussions years after you leave college.
  • If you are eligible for a grant, you should have already made your initial application, through susi.ie. If you haven’t and you think you may qualify, apply immediately, as late applications will lead to delays in receiving your payments. The earliest payment is mid-October, so you need to cover your costs until then. There are other scholarships and grants available to students. You can find more at studentfinance.ie.
  • Work out your budget for the year and stick to it. Your major outgoings will be rent and utilities, if you are living away from home, and rents are currently high. Investigate your options and decide what you can afford, and how it will be paid. Then, you have food, travel costs, books and other college supplies. It is vital that you know your weekly and monthly budget, so as to avoid being caught for cash towards the end of term.
  • If you will need part-time work during the year, get a headstart and begin looking now. Cities and towns with student populations will be inundated with job-hunters in September.

Once you know where you will be studying, start applying for work with suitable hours. Don’t over-commit to working hours. Remember, your primary aim is to study, so look for only as much work as you need.

  • Books for third-level courses can be expensive, but you don’t have to buy the whole book list new. Check the student library first. Most course books will be available to borrow. You will need your own copy of some books, so check if these are available second-hand, before you buy them new. Most of the students’ unions operate second-hand bookshops and you can also check bookshops near your college.
  • The first few weeks of college are incredibly exciting and it is easy to be swept up in socialising and other activities. But you may well rue all those freshers’ week nights out when grey November comes around and your budget is wiped out. Know exactly how much you have to spend each week and stick to it.
  • Be sensible about your diet. If you don’t know how to cook, take the time in the next few weeks to learn a few budget-conscious, healthy recipes. Not only will your skin, waistline and energy levels thank you, even cheap fast food is more expensive than preparing and eating food at home. If living in shared accommodation, plan with your housemates. It’s much cheaper to cook for a few than for one and you can take turns preparing meals. Discount supermarkets are your friend; get in the habit of doing a weekly shop. A stocked cupboard will help you resist the temptation and cost of the nearby chipper.

DEAL OF THE WEEK

We think the best current account on offer is from KBC. The account offers free ATM & cheque-lodgement fees, no quarterly maintenance fees, and free, contactless card-debit transactions. They offer online and mobile banking, so students can manage their finances from home, and free direct debits and standing orders. Note that KBC do not currently offer students an overdraft.

All of the major banks offer students current accounts without the usual fees and charges, but KBC are offering an impressive additional incentive. If you open and use a student current account with them, they will offer you a choice of two rewards: either €100 or two free return flights to a number of European destinations.

You get one flight or €40 when you open the account, and the second flight or remaining cash at the end of the year, provided you have used your debit card at least ten times. The flights are from Dublin (you may fly from elsewhere with a surcharge) to Berlin, Liverpool, London, Amsterdam, Madrid, Paris, Milan, Frankfurt or Brussels.

Next week we will look at student accommodation options in detail and also compare the student loans offered by Irish banks and credit unions.

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