Don't be scared by words and phrases like "budget", "disposable income", and "Betalingsservice" ("Payment Service"). These very words can become your best friends in times where money is tight.
Many students have found themselves a bit short on cash with some time to go before their next student grant payment shows up in their accounts. But what if you could avoid that end-of-the-month stress?
In reality, the best way to do so is to make a budget-- and stick to it. That way, you can get an overview of your income from student grants and/or your student job — and you can see how many expenses you have each month. You can use Excel to make your budget, but most banks also have a budget sheet online.
Get an overview of your income
First, fill in all your sources of income on your budget. That includes student grants, wages, housing support, money pulled from your savings, and maybe some money from home, too.
Get an overview of your fixed expenses
Then, take a look at all of the expenses you MUST pay each month, like your rent, electricity bill, insurance, transportation, mobile phone, and Netflix or HBO. If you've already set up direct debit payments with Betalingsservice, you can easily get an overview of your fixed expenses from your monthly payment summary. Remember, you can find it in your e-box.
Take control of your variable expenses
Unlike the fixed expenses you know in advance, there are also some "looser", more variable expenses. These are expenses you know you'll have, but without knowing exactly how much you'll spend on them each month. These include clothing, food, going out, travelling, and so on. This is where a budget often gives you an advantage. It's easy to spend more on these incidental expenses than you might expect initially.
This is also an opportunity for you to set aside a fixed amount for unforeseen expenses, like a dentist visit.
Divide up your budget
When you make a budget, it's a good idea to divide it into different categories, like housing and transportation. That way, you can easily have an overview of the individual components in your finances.
6 tips to keep a tight budget
- Set up direct debits through Betalingsservice for all your fixed expenses. That way, you can be certain that you won't make any late payments and incur extra charges.
- Save some money so that you have a little extra lying around in case of an unforeseen expense - or for the holiday of your dreams.
- Avoid short-term loans. They can quickly end up costing you a fortune. Instead, talk to your bank if you need to borrow money.
- Use your student ID and ask about student discounts wherever and whenever you can. That can save you a lot of money over the course of your studies.
- Limit your student loans. Remember that you'll need to pay them back 8 to 15 years after finishing your education.
- As a member of the Danish Association of Masters and PhDs, you also gain access to all kinds of discounts.