some budgeting advice for newbies
The leaves have changed, and there is a cold zip in the air. For those of us in post-secondary, midterm exams, group projects, and due dates are upon us. And so are the costs of being back in school.
Tuition, books, housing – it’s a lot. And, on top of that, food, car insurance, gas, and everything else. The drain on the bank account at this time of year can be startling.
So, what to do?
A great place to start is to learn from people who have been there and figured out ways to make it easier to budget and save money while going to school.
We’ve pulled together some real-life advice, including some from First Calgary Financial member Joshua, who is in his fourth year of studies at the University of Lethbridge.
"For some students, working part-time while going to school is the answer, for others it’s using student loans and living very frugally. It’s finding what is going to work for you personally and then working that plan. There are a lot of levers you can push and pull. Explore your options, do research, and take the time to look after your financial health. My one caution is to be careful using credit cards. Using credit card debt to pay for school is a bad idea.”
Cynthia MacNeil-Burke, Financial Experience Advisor for Connect First Credit Union.
Like most first-year students, Joshua learned this lesson quickly. “By the end of my first semester, I used up all the cash I was given, which was meant to last the whole year. I eventually learned from my mistakes and started budgeting in a more proactive manner by separating needs from wants.”
Joshua’s budget pain points included food and the local bar on campus. And he’s certainly not alone.
“I think most students experience that first semester shock and budget readjustment,” says Cynthia MacNeil-Burke, Financial Experience Advisor for Connect First Credit Union. “For many, it’s learning about financial independence and responsibility for the first time. Once you figure out the potential pitfalls, create a realistic budget for yourself to make sure you have enough money to make it through the school year.”
There are a lot of resources out there for students – check out what your school offers students in terms of advice and tools for budgeting. The Government of Canada has published a student budget worksheet, along with information and tips for budgeting for student life.
USE TECHNOLOGY TO STAY ON TRACK
Stay on top of your accounts and your budget by regularly checking your account balances. Paying close attention will keep you in the know. And you can up your game by using a budgeting app like Mint, YNAB, or Wally (there are lots to choose from). Even a spreadsheet you update regularly can be the right tool if you use it.
You can also create ‘electronic barriers’ between your spending money and your savings. Joshua keeps his emergency fund in a separate account which isn’t easy to access, making him think twice before touching it.
FIND THE RIGHT BALANCE FOR YOU
Financing your post-secondary studies is about finding what works for you when it comes to income, borrowing money, budgeting, and lifestyle.
“For some students, working part-time while going to school is the answer, for others it’s using student loans and living very frugally,” says Cynthia. “It’s finding what is going to work for you personally and then working that plan. There are a lot of levers you can push and pull. Explore your options, do research, and take the time to look after your financial health. My one caution is to be careful using credit cards. Using credit card debt to pay for school is a bad idea.”
For Joshua, part of his plan was applying for co-op work terms as part of his degree to earn a modest salary and gain valuable real-life work experience and start paying off his student debt.
REMEMBER, YOU’RE A STUDENT
There are two parts to this piece of advice.
The first part is to look for and take advantage of discounts and resources available to you while you’re in school. Whether it’s cheaper admission to a show, a discounted transit pass, or access to low-cost gym facilities or food options, your budget will thank you for searching out student-priced deals.
The second part is to realize and embrace that being a student is a temporary phase of life. Paying for school and juggling school stress while living on a tight budget won’t be forever.
“The work you put into budgeting and managing your finances while you’re in school not only matter while you’re a student but for the next phase of your life,” says Cynthia. “How will you be positioned for your future? What decisions can you make today to get off on the right foot after graduation?”
Closing the tab before pressing buy on an unneeded purchase or declining an invitation to eat out for the second time in a week is a smart and kind thing you, as your student-self, can do to help out your graduate-self. Feel free to say “You’re welcome” while doing it.
“Thinking of your future while making decisions in the present is always good financial advice,” concludes Cynthia.
First Calgary Financial loves students! Check out the student banking options we offer, and don’t hesitate to reach out if you have questions or looking for financial advice during this exciting time in your life.