The standard student grant has been abolished and room rents and tuition fees are rising. Even so, first-year students are generally managing to weather this financial storm, an EM survey shows.
“Students are greatest victim of purchasing power decrease in 2017.” This was students’ interest group ISO’s headline at the end of August. Given these circumstances, EM’s editors found themselves wondering – do first-year students know what they are getting into, and have they made sufficient financial arrangements to keep their heads above water? In order to help us find out, 138 students completed a survey on their situation and their expectations.
A little too optimistic
We can be proud of our first-year students. Generally speaking, students have a pretty good idea of the costs associated with being a student, although they tend to be just a little too optimistic. For example, students estimate their average monthly spend on shopping at €137, although the National Institute for Family Finance Information (Nibud) puts the figure at €161 per month and students expect to pay around €57 on health insurance premiums, while Nibud believes the monthly average to be €97.
According to Nibud spokesperson Annemarie Koop, many students believe that they have their finances straighter than their peers who do not attend university. “But they don’t know a thing about insurance policies. They don’t know exactly what concepts such as deductibles, premiums and terms and conditions mean.”
In a study conducted this summer by the “Wijzer in geldzaken” (More Sensible with Money) Platform, a very significant majority of parents indicated that they had prepared their children for living independently. Three out of five parents had sat their children down in order to identify expected income and expenses with them.
Parents often provide support
EM’s survey showed that parents are actively involved in their children’s finances. Two thirds of students discussed their finances with their parents. 77.5 percent of students said that they received financial support from their parents, the average monthly contribution being €529.
For students who don’t manage to stay completely on top of their finances, Nibud spokesperson Annemarie Koop provided one more tip on how to limit the damage. “At least once in your time at uni, draw up a financial overview. Not only will it help you get a better understanding of what you are spending each month, it will also tell you what income is missing. For instance, many students forget to apply for a health insurance allowance, even though the application process is very straightforward.” It is also important to check all your bank statements once in a while to get an idea of what withdrawals are being made. “If you do that, you may find that you are still paying membership fees for a club in your parents’ village, even though you haven’t attended a club event for years. Going through all these individual withdrawals will really help you make useful decisions. If you’re still short on cash, it will help you determine what to cut down on.”
Read more about the EM survey into the financial situation of first-year students in the paper edition of Erasmus Magazine which is available from this week. You can find the digital edition here.