Money Management Tips for Students During COVID-19

The coronavirus pandemic has brought the world to a complete halt. Lockdowns came into effect across the globe, and the economy plummeted. All non-essential services were closed, including cinema halls, restaurants, malls and shopping centres. Millions of people lost their jobs, and those who were still employed had to take pay cuts. Unemployment rates also rose significantly, which unfortunately included students who were working part-time as well. If you're a student and were working part-time to help make ends meet, losing your job during the pandemic might have made you feel lost or helpless. However, take heart. All is not lost. Continue looking for other opportunities (without getting bogged down) and give it your best shot. Until you land your next part-time job, there are several measures you can take to manage your current finances. Here four tips to help you do just that:

1. Cut Down on Unnecessary Spending

The first step to managing your finances when you’re unemployed is eliminating expenses you don’t need. There may be several subscriptions/memberships that you signed up for when you were employed but don't need anymore. It could be a magazine subscription, Netflix, or even a gym membership. When you're trying to cut costs, such expenses are inessential. Until you get your next job, you have to live on whatever savings you have for as long as possible. So, it's vital to know where your money’s going. This way, you automatically know what to cut down on. Once you get another job & things get back to normal, you can restart the membership.

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2. Use a Money Management App

There are several money management apps available in the Apple Store and Google Play that can help you track your spending. If you want to know how every rupee is getting spent, then using a money management app is a good idea. Such apps can also help you budget well, which in turn can help you save more. The good thing about these apps is that they can help you manage your monthly expenses and then show you how much you have left for spending. For example, if you have to pay your personal loan EMIs every month, you can input that into the app. It will then remind you and alert you when you exceed your spending limit in a particular month.

3. Pay Off Your Credit Card Debt in Full

First things first: if you’re a student, you should avoid borrowing money as much as possible. When you ­do need to borrow money, using a credit card shouldn't be your first option. You should only be using your credit card for emergencies, and when you're unemployed, paying off your credit card dues fully should be your top priority. If you don't do it on time, you will be charged higher interest on your purchases next month. Suppose you only keep making the minimum payment every month. In that case, it'll take you longer to get out of this debt trap while negatively affecting your credit score as well. Indeed, you can't get a personal loan as a student. Still, when you have no income coming your way, you should ideally stop using your credit card and spend money only on essentials.

4. Shop Smart

Since your focus is now on saving money, it’s critical to make sure that when you do spend money, you do so efficiently. One of the things you can tackle is your grocery shopping. Since you, anyway, have to shop for groceries every week/fortnight, you need to be smart about it. While going grocery shopping, always create and stick to your shopping list. You also need to ensure that the items on your list are essentials and resist picking up extra items near the checkout counter. It’s also recommended that you do your grocery shopping when there are discounts/offers going on. This way, you save even more. If your supermarket has a particular day of the week for putting out offers/discounts, see if you can get your groceries on that day.

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Wrap Up

The points mentioned above are four ways to manage your money effectively during the COVID-19 pandemic. Remember, even if you’re fortunate enough to hold a job during this time, you should try to save as much money as possible for emergencies. Clear off existing debts and hold off on taking out new loans. While it’s true that you can’t take out personal loans as a student, your parents or relatives may need extra funds to pull through. If so, you can always tell them about KreditBee. It is India’s leading personal loan platform that offers quick loans online. To get more information on how you can avail of a personal loan, email us at [email protected], and we will take it from there.

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