Even if you feel like a penniless student who can barely scrape together enough for a decent night out, it’s worth opening a savings account. Just putting a tenner in each week is enough to net you £1,560 (plus interest) in three years’ time – and trust me, that money will definitely come in handy once you need to buy furniture, smart work clothes, pay for transport…
And if you’ve got a savings account set up, you can shove any “extra” money that comes your way (Christmas gifts, in particular) straight into that. There’s a definite psychological benefit in separating your spending money in your current account from money that you’re saving up towards your first house, a round-the-world-trip or to ease the eventual transition from uni into the working world. If you put all your money into your current account, it’s very easy to end up splashing out on gadgets and gizmos that you don’t really need.
What savings account should I get?
I am no financial expert, and there’s no one perfect savings account to suit everyone. The best advice I can offer is to shop around. Figure out what you want from a savings account, and talk to some banks and building societies, or have a search online.
Some good points to bear in mind are:
- Make sure you can get money out when you need it. Of course, it’d be great if you never have to dip into savings while you’re a student – but it’s very useful to have the possibility available.
- Try to get an account which you can manage online: it’ll save a lot of time in the long run, especially if you often deposit small sums.
- Look at interest rates, but don’t get too hung up on them. You probably won’t be saving enough for it to make a huge difference. In the long run, ease of access trumps an extra tenner over the course of three years…
Earmarking money for savings
It’s entirely up to you what money you put into your savings account, but it can help if you make a mental (or physical) list of what money you plan to save. For example, you might find your budgeting skills stretched to the limit during term-time, but you know you can put half your summer job’s pay straight into savings.
Other good ways to save include:
- Doing some freelance work related to your degree
- Putting any gifts of money into your savings account
- Giving up a particular vice (alcohol, ciggies) for a period of time, and saving the money that you don’t spend
- Setting aside a small percentage of your student loan (say, £100) at the start of each term.
Over to you
- Use your skills: find a job on Student Gems – a post here on Alpha Student which could help you find a bit of extra income to channel into your savings account.
- Savings accounts – an extensive and comprehensive guide from MoneySavingExpert.com
- Save money, log your spending – If you know you’re spending too much, this could help you figure out where it’s all going…
Do you have a savings account? Does it contain precisely 2p, or are you taking active steps to add to it (or at least not take money out)? Are you saving, or would you like to save, towards a particular event – or do you just want money “for the future”?