Tips for Healthy Finances
1. Prepare. If you've just tried to work out your budget, you've probably realised that government loans and school scholarships don't always go far enough. It may be the last thing you feel like doing in the months before your course begins, but unless you can be sure of extra help from parents etc., start saving now!
2. Plan. Even if you never write it all down (although it is a useful and often revealing exercise to do so), do plan a monthly budget based on your likely income. If your parents are contributing to your income, ask them to pay you in monthly instalments. If you know you're bad at managing your money, set up the same system for your loan or scholarship, by putting the termly lump sum into a savings account, and withdrawing the same amount each month. This may seem unnecessarily strict, but it will help you to pace yourself.
3. Choose your bank carefully, and be honest with them. If you do have cashflow problems, they may be willing to help in the short term: don't just ignore their attempts to contact you - the cost for doing so could be high. If you're an international student, some banks may try to place unfair restrictions on you, such as demanding a minimum balance.
For a comparison of all the different offers at the major banks, see the website at www.support4learning.org.uk. This is also a good source of advice on other finance-related issues.
4. Course costs - stop and think. Very few courses have a long list of absolutely essential texts. Often, using the "best social science library in the world" is perfectly adequate - they will have numerous copies of any book highlighted as essential reading on your lists. If you are studying on a text book-based course (economics and law are obvious examples) the texts will almost certainly be available second-hand. Unless you are being asked to buy a new edition, check out Alpha Books, Waterstone's and the numerous individual posters around campus offering second hand copies of the most essential course texts. You may also wish to check out the information on course packs on the Union website.
5. Avoid expensive debts. Your bank may offer you a fee-free credit card, but the interest rates will still be sky-high. Unless you really trust yourself, steer clear from these tempting pieces of plastic, the biggest single cause of student debt in the UK. The same goes for store cards and mail order catalogues (their interest rates are often higher than general credit cards). Similarly, you may find a pay-monthly mobile phone puts an unreasonable strain on your budget, since you are committed to a minimum of twelve monthly payments, whether or not you use the phone. If what you're buying is absolutely essential, build repayments into your monthly budget, and keep up with them to avoid paying extra interest.
6. Keep records. Another dull piece of advice, but bank statements, bills and receipts are all forms of proof that could be useful to you. Bank statements demonstrate how you've spent your money and may be important in applying for hardship funds (banks will charge you to get copies). Receipts are crucial to prove you've made a payment, or to satisfy guarantees/warranties on expensive goods.
7. Use your student status. There are obvious discounts out there: NUS cards give you all kinds of discounts including reduced cinema tickets and 10% off at HMV and Topshop; a London Transport Student card will get you 30% off all your weekly or monthly travelcards. Both the cards above, and information on other offers, are available at Freshers' Fair at the beginning of the academic year, or from Student Union reception all year round. Theatres offer "student standby" tickets and many other attractions have special student deals. Keep a lookout and make the most of them.
8. Don't "retreat". However bad things get financially, ignoring the problem will never make it go away. In the case of banks, failure to keep in contact could result in expensive charges and a bad record for the future. Within LSE, debts in the form of fees, hall rent or library fines may result in the withholding of your exam results or even degree. Keep up negotiations, be honest, and people will do their best to help you.
9. Don't leave the country without paying. International students sometimes see this as a tempting option, particularly with regard to student bank account overdrafts. It is true that you probably won't be prosecuted for such a debt once in another country (international proceedings, or UK County Court proceedings can be issued based on your last UK address, but the cost of recovering the debt from someone abroad is often larger than the size of the original debt). But remember that many banks are international corporations, and your record in one country may have influence in another. Leaving a debt unpaid will also have implications for your future in the UK, since you will leave with a bad credit rating, making all kinds of future financial transactions very difficult.
10. Don't panic. Even if you've reached crisis point, there's probably something that can be done. Contact the Students' Union Advice Centre in E297 open 10:30-4:00 during September and term time, su.advice-centre@lse.ac.uk
for advice on what to do next.
