The spending all the money you have so that you don't lose it is a problem actually created by anti-corruption bureaucracy, and is very common in government funded areas.

The problem is that in an effort to avoid being wasteful, the bureaucracy aggressively tracks money spent, and forces a return of unused funds. This in turn disincentivizes saving because there is literally no benefit to spending efficiently or saving money for rough times, because those short term savings are immediately vacuumed back up by the higher level bureacracy.

Blaming student services departments for overspending is missing the root of the problem. I've seen the exact same issues in STEM research institutions.