For most students, it's impossible to avoid being thousands of pounds in debt. But it is possible to keep costs down.

With warnings that some students are being priced out of university, it's the financial challenges of being a student that many parents are concerned about. It's predicted that one in four students who start university in 2009 expect to graduate with over £20,000 of debts. Part of going to university is that your son or daughter will be able to make their own decisions. But you can still point them in the right direction if they need help with their finances.


Student loan cheque

Many students say they feel rich when they first get their hands on their student loan cheque. It's probably the largest sum of money they've ever handled, so you may have your work cut out trying to convince your son or daughter about the merits of budgeting – although it may get easier once they’ve been at university for a few months and have seen how quickly money slips through their fingers.

SAVVY TIP: Many parents give their children money to help them through university. It will help them to plan their spending if you give them a set amount regularly, rather than bailing them out every so often. Perhaps you could agree to pay a specific cost up to a certain limit? Work out something so you son or daughter won't feel like they have to account to you for every penny, but so you're not writing a blank cheque.

Information

Most of the student websites have a lot of information about how to manage money. Sites to try include the NUS, Push (an independent guide to student life) and the financial capability website produced by the Consumer Finance Education Body called What about Money?.

SAVVY TIP: It’s definitely worth having a money conversation with your son or daughter before they have to make decisions for themselves. They may choose to ignore you, but some students complain that while their parents talked to them about sex and drugs, money remained a taboo.

Bank accounts

Banks normally offer all kinds of goodies to tempt students to sign up. Some are well worth having (NatWest’s student railcard is normally popular), others may not be. It’s the size of the interest-free overdraft that’s important. Student life is tough enough without paying interest when they’re overdrawn.

This year, a number of banks are offering a flat rate of overdraft (which stays the same throughout university), while others have tiered overdraft levels, which increase. Most price comparison websites have tables with details of student accounts. Try SavvyWoman's top deals, provided by Moneyfacts or websites such as sites such as MoneySavingExpert or Moneynet.co.uk, which has student account summary.

SAVVY TIP: Students don’t need to wait until they go to university to open a student bank account. They just need their UCAS confirmation letter or a letter from their university telling them they’re being offered a place.

Insurance

Your own household insurance policy may cover your son or daughter while they’re at university, which means they won’t have to pay for a separate policy.

• Be aware that some insurers will charge for this, while others offer it for free, and several have pretty low limits – between £2,500 and £5,000 – on contents they’ll cover in a student flat or house.

• Many policies won’t allow a claim if something’s stolen from a student room if it doesn’t have a lock on it. Endsleigh insurance is one company to sell student room insurance.

Save money, make money

The NUS sells a discount card for £10 a year (called NUS Extra, which gives cardholders access to a wide range of discounts from national chains. However, it’s worth knowing that some shops will give all students a discount if they have a student ID card (which they can get free of charge). In the current climate, it’s definitely worth asking for money off.

SAVVY TIP: Sites like Moneymakingstudent.co.uk have lots of money making and saving ideas and a good way of getting your daughter (or son) to spend less on clothes is to encourage them to swish (swap clothes with others). There are two swishing sites to try; swishing.org and swishing.co.uk.