Students: how to complete your degree without graduating with debt

An ordinary personal or household budget focuses on one month: how much came in and how much went out. For students, that narrow view is not enough. The academic calendar moves in uneven waves:

• September and October: Tuition or deposits are due, and you may need a computer or other expensive equipment.
• January and February, and June and July—exam periods: Work shifts fall sharply and income drops.
• Summer months: There may be an opportunity to work full time and increase income.
• In between: Variable events arise, such as a friend’s wedding, a short trip, or moving home.

The right strategy is to manage a semester and annual budget. Write down all expected income for the year alongside the major and fixed expenses you know will arrive. If annual tuition is ₪12,000, do not treat it as “October’s problem.” Set aside ₪1,000 every month throughout the year.

A scholarship may be one of the best investments of your time.

Thousands of scholarship programs use different criteria: socioeconomic position, place of residence, parents’ country of origin, field of study, academic excellence, research, community volunteering, military or national service, and more.

Do not stop after one superficial search. Investigate the student union, your institution’s website, your local authority, philanthropic foundations, and dedicated programs. The process requires paperwork—forms, certificates, and application letters. But if five hours of collecting documents produces a ₪5,000 scholarship, the effective hourly returnThe profit (or loss) from an investment over a certain period, usually expressed as a percentage of the original amount invested. is ₪1,000.

Work during your degree needs to fit your lifestyle and academic schedule.

A job paying slightly less per hour but allowing more work during breaks and fewer shifts during exams may be better than one offering no flexibility.

As your degree progresses, look beyond next month’s payslip. A student job in your field—even at basic pay—can be extremely valuable in the long term. It gives you:

• Essential hands-on experience.
• Professional networking with people in the industry.
• An important line on your résumé.
• A much easier and faster entry into the labor market after graduation.

Coffee and eating out do add up.

But for most students, the largest expenses are elsewhere: housing and transport.

Living alone instead of with roommates, choosing a fashionable and expensive neighborhood instead of a more distant one, or keeping a private car instead of using public transport can create differences of thousands of shekels every month.

Before punishing yourself over a ₪15 coffee, make the truly large decisions:

• Do your institution’s student residences offer a more economical alternative?
• Should you live with roommates?
• Is it realistic and acceptable to live with your parents for a period?
• What does a car actually cost, including insuranceA contract under which an insurance company undertakes to compensate the insured in the event of damage in exchange for a periodic payment., fuel, maintenance, and parking?
• Is a cheaper home farther from campus still worthwhile after including travel cost and time?

Your student card is not only a library pass. It can provide significant discounts on public and private services.

Public transport

Israel’s public-transport system has a dedicated student profile, with significant discounts and especially attractive semester and annual arrangements for daily travel to campus.

A regular student profile currently provides a fixed 33% discount. Make sure it is active in your travel apps or on your Rav-Kav (רב־קו) card. Do not continue paying full price out of habit or laziness.

Arnona at the local authority

Many students assume that student status automatically provides an exemption or discount on municipal property tax.

It does not. Eligibility for an arnona (ארנונה) discount is based on a strict income test and the specific rules of each local authority.

If you share an apartment, ask the municipality’s collection department how it calculates each roommate’s proportional share for a discount based on individual income.

Bank accounts and fees

Proactively check whether your bank offers a student plan exempt from basic current-account fees, which fees you actually pay, and which benefits remain after the promotional period. Do not assume that an account labelled “student account” is the cheapest or most suitable option in the market.

Sometimes financial support is lacking and a loan is unavoidable in order to complete the degree. But distinguish sharply between a targeted loan that bridges a defined temporary cash-flow gap and one that finances a permanent shortfall in ordinary life.

If you are short ₪2,000 every month, a ₪20,000 loan solves no structural problem. It merely buys time, postpones the problem for several months, and adds a monthly repayment and interestThe "price of money" – the amount paid for the use of someone else’s money, as income to the depositor or as a cost to the borrower. to the existing deficit.

Before digitally signing a loan, answer:

1. What exactly is this money for?
2. What is the exact minimum amount we need?
3. What is the real interest rate and total repayment cost?
4. Exactly when does repayment begin? Is there a grace period during the degree?
5. What exact source will fund the repayments?

The installment trap

Credit-card installments can be useful for a large, unusual, one-time expense, such as an urgent repair or a study computer. Financial trouble begins when students spread ordinary life itself over installments: supermarket shopping in three payments, clothing in four, and a night at the pub in installments.

Before the new calendar month has even begun, much of your limited future income is already committed to debts and charges from previous months.

National Insurance contributions are among the expenses students forget most often, sometimes creating accumulating debts with penalties and index linkage.

A higher-education student who does not work is legally required, as of 2026, to pay a fixed minimum of ₪171 per month for National Insurance and health-insurance contributions.

If you work as an employee, contributions are handled through the payslip. Part is deducted from your pay and the employer pays its share, so there is no separate minimum payment for a non-working student. Even part-time work can provide income and remove that separate payment.

Make sure your status is accurately updated with Bituach Leumi (ביטוח לאומי, the National Insurance Institute), especially when starting a new job or stopping work before exams. The main risk is not the monthly amount but ignoring the issue for an entire year and later receiving a burdensome debt notice.

Students often move between temporary jobs, change employers, or work two small jobs at once. Do not assume the employer’s calculation or payroll software is always correct simply because the payslip looks complicated.

Spend five minutes each month checking:

• That every hour and shift you worked was recorded.
• That travel expenses, overtime, and convalescence pay were paid if you are eligible.
• That lawful pensionA monthly payment made to a person after retirement from work in order to help maintain their standard of living. and severance deposits are made according to your eligibility. If you arrived with an active pension account from a previous workplace, this can materially affect pension continuity and the deposit start date.
• Tax coordination: If you work for two employers—for example, teaching at a university and weekend bar shifts—complete tax coordination through the Tax Authority website. Without it, the second employer may need to deduct the maximum tax rate, amounting to tens of percent of your pay.

Some people will tell you that the goal during your degree is merely to survive and saving is impossible. In practice, even a standing order of ₪100, ₪200, or ₪300 a month into savings or Kupat Gemel LeHashkaa (קופת גמל להשקעה)A flexible savings vehicle that allows withdrawal at any time, or receipt of a tax-exempt pension after age 60. can build a powerful habit. At this stage, the precise amount matters less than establishing the habit of regular saving. Time and compound interestA situation in which the returns accumulated on an investment are reinvested and generate additional returns themselves, creating accelerated growth of the money over time. are powerful in long-term savings.

But do not save blindly at any cost. If you insist on placing ₪200 a month into a low-return savings plan while remaining permanently overdrawn or paying high interest on an expensive loan, you are not saving—you are losing money each month.

The right financial order

1. Repay expensive debt: Eliminate the overdraft, short-term loans, and credit-card debt.
2. Build an emergency fund: Accumulate a small liquid amount, such as one or two months of expenses, solely for unexpected emergencies—urgent dental care, a computer repair, or a sudden move.
3. Save and invest: Only after the first two stages are complete should spare money go to long-term savings or capital-market investments.

Starting early is excellent, because time is powerful in long-term savings. But saving should build stability, not force you to borrow to finish the month.

This will not help you through the current exams, but it matters for the day after graduation.

Graduates who completed academic studies from 2023 onward may be entitled to significant income-tax credits beginning in the tax year after graduation:

• Bachelor’s degree: One tax-credit point for up to three years.
• Master’s degree: Half a tax-credit point for up to two years.

Eligibility and duration are subject to Tax Authority rules and the standard length of the program.

The benefit can be worth thousands of net shekels a year. It is not added to your payslip automatically. Claim it proactively through Form 101 with your employer at the beginning of the year, or by applying directly for tax coordination or a tax refund.

1. Bituach Leumi — National Insurance contribution for a student — Current information on the payment required from a student who does not work.
2. National Public Transport Authority — Information for students — Information on the student profile and public-transport discounts.
3. Kol Zchut (כל זכות) — Arnona discount for people with low income — Possible eligibility, the income test, and treatment of shared apartments.
4. Israel Tax Authority — Tax benefit for academic graduates — Tax-credit points and how to claim the benefit after graduation.
5. Kol Zchut — Mandatory pension insurance and continuity of rights — Useful information for students who work and change employers.