Australian universities rank among some of the best in the world. With a great education standard and world class facilities, people love having the opportunity to study here and achieve amazing things through their degree.
One thing to be on top of though is your student loan – you don’t want to let it slide for too long! So, whether you’ve received business student, engineering student or medical student loans, here are some tips for managing your student loan.
- Don’t ignore your loan!
When we’re young we often carry a blase attitude when it comes to finances. You see a bill and say, “oh well, next *name* will deal with that”. But your student loan, along with other interest-centric payments, shouldn’t be ignored. Ignoring your student loan can come with added fees and can even affect your credit score, so best to keep on top of it and make timely repayments.
- Make timely repayments
In the same way you shouldn’t completely ignore your loan, you should make a habit of repaying it at an assigned point of the month. You may receive a particular payment every second week, and once you have put aside money for other bills, groceries etc. you can think about making your repayment. By making repayment a continuous habit, you will feel confident with the knowledge that you are paying back on time and in consistent increments.
- Try the 50/30/20 rule
This is a tried-and-tested budget strategy that seems to have been designed for students. While we may want to spend all our money on the things we like, we realise once we hit a certain age that this simply isn’t the case.
This being said, spending your income on necessities like rent, bills and food have their own benefits – you feel more mature and confident that you can take on adulting every time you make that repayment or pick up a bag of groceries.
So, what is the 50/30/20 rule? Basically, you spend 50% of your budget on necessities (rent, bills, groceries, repayments etc.), 30% on wants (clothes, going out, classes etc.), with your final 20% going towards your savings.
Students often think there is no chance they will be able to save while studying, but if you can fit in your necessities to 50% of your budget whilst limiting the splurging on great but potentially unnecessary goods, you can start to make a good go at saving for things like cars, holidays, even houses!
- Know what you owe (& plan accordingly!)
Student loans are much more easily repaid when you know exactly what you owe and can plan accordingly. By calculating the amount you need to repay, you can then develop a payment that allows you to chip away at the loan each month whilst projecting how long it will be until your loan is repaid. Understanding your loan and when it will be repaid really helps to understand your overall financial situation – something that is important for future finances.
- Get on top of your expenditure
It’s a great idea to get on top of your expenditure and know where your money is going every month. You might find that you are spending too much on apps, goods or purchases that you simply don’t need as much of and can happily cut out of your student budget. Being budget-savvy is a big part of growing up, and you’ll be stoked the day you realise you’re a person who knows how to spend and spend wisely.