Managing Your Money

Managing your money is a real life skill! There is a lot to learn and a lot of information out there, let us break it down for you.

On this page we cover the following:

1. Interesting information about money
2. Credit vs Debit
3. Budgeting and Cost of Living support
4. Savings
5. University and Student loans
6. Borrow money with a credit card
7. Debt
8. Investing -risk or reward

• We also have information if you or someone you know is worried about the cost of living.

Did you know?

What is the difference between tax and National Insurance?
Income Tax: is a deduction that goes towards paying for all the services we use in our society.
National Insurance contributions: pay for certain state benefits, including your State Pension and NHS Services.

What does the term PAYE stand for?
Pay as you earn. This is the way most employees pay tax – it is deducted by the employer – so the amount of money received comes after tax is taken off.

Do you know the difference between a standing order and a direct debit?
Standing orders: You are in control. You instruct your bank to pay the money to a particular person or company, and it is your responsibility to change the payment details.
Direct debit: You instruct your bank to release money automatically from your account each month to pay bills and other amounts. The billing company has control.

What is phishing?
Phishing is a criminal activity which attempts to mislead you into providing your personal information and bank account details. This is often done online through fake emails and text messages. Never share your bank account details or pin number to anyone.

What Financial Support is available? Find out about financial support if you need it – benefits – GOV.UK Or take a look at our factsheet below.

“What’s the difference between a credit card or a debit card?“

A debit card is what you get when you open a current account with any bank. You deposit money into this account (both in person and online) and the money you use is this money.

A credit card needs an application. The money that is available on this card and with this account is borrowed and you must repay this monthly.

Which is better – credit or debit?

There is no right or wrong answer to the question – find out which one works best for you. When you are first working, you may find it best to only use a current account to keep track of your money.

Some people like to use a credit card to build up their credit score, which will help them move towards bigger commitments, like a mortgage.

You can also organise an overdraft to help cover for unexpected outgoings (it’s like a short term debt, useful if you get low on money at the end of the month).
– DO speak to your bank, agree a suitable limit that you can easily pay back and set up re-payments so you don’t get charged.

“How do I budget?“

Maybe you or a parent are worried about the cost of living? 

Use the links on this page to help find support, including Citizens Advice.

You can find out more about cost of living support on the Suffolk County Council's website.

Anglia Care Trust outline more general advice on how to reduce your outgoings - Reducing Everyday Living Costs | Anglia Care Trust

It can be really stressful, when you don't have enough money or you are struggling with debt- but there are people to help you. 

“How do I save?“

“How do I plan for university and understand student loans.”

Student loans:

A student loan pays for your university course tuition fees during the 3 years of your degree. If each year of your degree your course tuition fee is £9,000 for instance, this will mean you will graduate with £27,000 of student loan borrowed debt.

The Government has announced that for students starting university courses from 2023/24, that tuition fees will be frozen at £9,250 for another two years. 

Your student loan is split into two parts: a tuition fee loan to cover the cost of your studies and a maintenance loan to help you with the cost of living while studying.

Maintenance loans are means tested which means how much you are paid depends on your household income and how much your parents earn. Due to this your parents may be expected to contribute to your cost of living while studying.  

To find out what tuition fees cover and how you apply for a student loan, visit the UCAS website.

Living costs while at university:

Depending on how much maintenance loan you get, you may need to consider planning how you will afford to live away from home to help cover the weekly costs of food, clothes, travel, entertainment and course equipment.

Tips to help save money at university:

1. Use your student overdraft wisely
2. Be smart in the supermarket – plan meals together with housemates to help share cost of food.
3. Ask about student discounts in shops/places you go
4. Buy second-hand course books/laptops
5. Get a 16-25 railcard

Current student loan repayments:
You become eligible to repay your student loan in the April after you leave University. 

Students must repay loans at a rate of 9% of everything they earn above £27,295 each year. (you do not repay anything if you earn less than this). For example, if you start earning £32,295 after graduating (£5,000 more than the £27,295 threshold) you’ll repay 9% of that – which is £450 a year.

Interest on student loans:
After you graduate, each year you will receive an annual statement which shows you your student loan amount and the yearly interest on top of this.
With any loan you take out you pay interest for the amount you have burrowed until the loan is paid off. Student loans have the lowest interest rates compared to other loans. The MoneySavingExpert helps explain about student loan interest.

“How do I borrow money with a credit card?“

The first step is to approach a bank. But, here are some useful tips before you do:

• Figure our how much you can afford to repay each month.
• Read the forms before you sign them. If you don’t understand them get help from the Citizens Advice Bureau (CAB) website.
• Check exactly how much you’ll pay back including interest and charges.
• Watch out for optional extras. Sometimes payment protection insurance is included when you haven’t asked for it. You don’t have to take this up and it may not cover you if you’re self-employed or on a short term contract.
• Look at the length of the loan not just the monthly payment.
• Set up automatic repayments so you don’t go into debt.

Getting help if you are struggling with debt 

Don’t bury your head in the sand. There are a few things you can do if you’re having trouble managing your debt:

• Speak to your bank. 
• For independent advice, visit the CAB website
• Call the National Debtline on 0808 808 4000

Investing – Risk and reward

What is the difference between investments and gambling?

An investment means you have…

• You have done your research before investing
• the odds are favorable;
• the activity is ongoing and done as part of a long-term plan;
• the activity is not motivated solely by entertainment or compulsion;
• you have ownership of something
• more likely to get a positive result from investing your money in something

Gambling means you have…

• done little or no research
• the odds are unfavorable;
• is risk-seeking;
• the activity is a discrete event or series of discrete events not done as part of a long-term plan;
• the activity is significantly motivated by entertainment or compulsion;
• you do not have ownership of something tangible
• gambling is addictive so you will end up losing more money than you gained.

What is Insurance?

Insurance is a financial product sold by insurance companies to safeguard you and/or your property against the risk of loss, damage or theft. There are various types of insurance including car, home, life, and travel insurance.

You take out an insurance policy to cover you or your items up to a certain amount – based on their value, over a certain period, and based on how much you want to pay each month for your insurance policy.

An insurance policy protects you for instance if you go on holiday and had an accident. Your travel insurance policy will cover the cost of any medical bills while in hospital abroad so that you don’t have to pay for these bills yourself, or if someone broke into your house and stole your items, you can make a claim on your home-contents insurance for the value of the items you have lost to replace them.

To take out an insurance policy you should go to an insurance comparison website like MoneySuperMarket to get the best insurance policy cover deals.

Need proof of age?
If you need proof of age ID, we suggest getting a Citizen Card, visit CitizenCard.com.