Second-year student guide: paying bills responsibly

Having to start paying bills in the second year of university can be daunting, and you might be tempted to avoid checking your bank balance.

In a recent survey conducted by online student bill-sharing tool Split The Bills, a quarter (24.3%) of young people who took part said they don’t check how much their bills cost. However, being in denial about what you can afford can quickly lead to debt, so it’s crucial that you get organised and pay bills responsibly.

Ashley Tate, chief executive officer at Split The Bills, said: “Don’t ignore your bills—make sure you sort them out as soon as possible. They won’t go away so the sooner you get organised, the better.”

How much do utility bills cost?

It’s important to be aware of the monthly costs for your utility bills, which are the basic services that keep your student home running. These include the following:

  • Electricity and gas

The average UK monthly electricity bill is £49 and £48 for gas, according to the Money Advice Service.

 

  • Broadband

The prices for broadband packages vary but the average cost is reported to be £16.90 per month.

 

  • TV licence

You need a colour TV licence to watch BBC iPlayer online and basic TV or Freeview channels, and this costs £12.50 per month (£150.50 a year). However, as a student you could get a partial refund for the months you aren’t living in the house.

 

  • TV package (e.g. Sky, Virgin Media)

Prices for a TV subscription package start from around £20 a month.

 

  • Water and sewerage

These bills often differ depending on location, but it’s estimated that the average monthly cost is £33. Water bills are sometimes incorporated in the monthly rent charge for student homes.

What should you prioritise?

As soon as you move in, you’ll need to read the gas and electricity meters to make sure you only get charged for the power you use. Write down the numbers from left to right, aside from any red numbers or dials, and give the readings to your energy provider.

Find out which electricity provider the house is currently using and register all housemates with them as soon as possible, unless you decide to sign up with an alternate supplier.

Not all homes have a gas connection, but if your property does, it may be cost-effective to set up a dual-fuel tariff with one energy supplier.

As a full-time student, you’re excused from paying any council tax but this doesn’t happen automatically. To avoid any surprise charges, you’ll need to register as a ‘disregarded person’ with your local council.

Hayley Cheshire, office manager at Fit Property said: “Get your broadband sorted before you move in. It can take from two to three weeks to install, especially during the busy period when everyone is moving into their new student houses.”

Get organised

In the Split The Bills study, 12.8% of people aged between 18 and 24 admitted to not knowing the cost of their bills because somebody else is responsible for paying them. Research shows that having an organised system in place is the best way to make sure you pay your bills on time.

There are different ways to pay bills, including:

  • setting up a joint account
  • putting bills in one housemate’s name and letting them make payments
  • using a bill-splitting company

Hayley said: “If you’re struggling with the idea of paying bills for the first time, rent an all-inclusive property or use a bill-splitting company. Bills are complicated and can be very stressful.”

You can pass the responsibility of paying utility providers to a bill-splitting company, who will divide all payments into one monthly cost. This avoids the need for the housemate responsible for paying bills, to chase their friends for money each month. It also means the shared account won’t affect every housemate’s credit rating if it goes overdrawn.

However, to cover the charge for this service, make sure you have enough money in your budget.

“You must discuss bills with your housemates and agree on a way to pay the bills responsibly,” Ashley said. “Otherwise, some of you might end up paying more than others, be overcharged, or late with making payments.”

So you and your housemates don’t argue over money, make sure everybody is contributing equally and fairly. It’s also essential that you keep an eye on your individual finances and budget for the cost of utility bills.

Survey data

“Are you aware of what money from bills comes out of your bank?”

Answers

Percentage

No, I use direct debit so do not check

24.3%

No, somebody else is responsible for bills

12.8%

I know the total amount but not each bill

5.9%

Yes, I keep track of all my bills

43.5%

Yes, I remember the amount from setting up

13.5%

 

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Molly Hare

Molly Hare // Student Wire Magazine Editor // PR and Journalism student at Leeds Beckett // Book worm, cocktail connoisseur, gherkin fanatic //

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