This year A Level results fell slightly for the first time in 30 years, yet a record number of university places have been offered to students in the UK. Those same students have now started what are arguably the most important three years of their lives. However, first year university students are now also in the process of managing debt of approximately £54,000 when taking a three year course, so the importance of staying on top of their finances has never been higher.
With the business owners of the future now stepping out on their own at university, it's a great time to look at the lessons that can be learned from the ways professionals manage their money.
Businesses often rely on accountancy software to help them keep track of their cash flow. I believe the values accounting tools promote should also be embraced when managing personal finances. Below are a number of simple tips to help stay on top of personal accounts.
• Smart supplier choices - Whether it's stationary or sandwiches, most businesses have preferred suppliers for all the products they require. This eases their financial management as they have a clear sight of how much is being spent on each area of the business. By having standard suppliers, consumers have the ability to predict monthly expenditure to ensure they avoid the dreaded unplanned overdraft. Once suppliers are under control, it's vital that the costs are managed.
• Managing expenses - For most, expenses are part and parcel of working life so keeping stringent records of the money spent at work is often second nature. This should also be the case for personal finances. In the same way that business leaders have sight of exactly how much they spend on all their supplies, students and consumers should manage their expenses, whether its how much is being spent on food or household bills. Using tools such as internet banking and smartphone payslips can ensure they have a much tighter handle on their personal finances.
• Personal budgeting apps - With a recent study showing people on average pick up their smartphones 1,500 times a week, it's clear they have become part of our everyday lives. In the business world apps are increasingly used to support finance management. By having easy to use technology which highlights expenditure, debts and bank balances, it's never been easier to manage personal finances.
• Online learning - Businesses of all sizes often use e-learning tools to ensure they are utilising all the features of the operating systems they use throughout the working day. They also work with partners, such as accountants in similar ways but with far tighter security and workflow. Students also collaborate with other students too, using social media platforms such as Google docs and Dropbox. It's worth considering using similar online learning to support financial management to ensure you steer clear of the dangerous world of debt in the same way businesses utilise accountancy software to stay on top of their finances.
• Document collaboration - Many businesses rely on partners, such as accountants to manage their finances. Students collaborate with their lecturers throughout university to submit essays for marking, businesses share documents digitally to enable electronic tax approvals. Taking this experience once you've made it onto the career ladder will support stringent personal finance management.
Following these simple steps can have a big impact on financial management and cut out the stress brought on by a lack of funds when bills arrive. By taking a leaf out of the business playbook, personal finance issues could be a thing of the past.