How to create and respect a budget as a student.
Surviving as a student in today’s day and age is definitely challenging. From paying high tuition fees, finding affordable housing let alone indulging in a night out on the town every once and a while, students have to pay close attention to their bank accounts. Knowing where your money is going and prioritizing your spending is key to meeting your financial goals and the younger you start, the easier it is. Below, we’ve outlined some key points to help you stay financially on track this year and for years to come.
Creating a budget
Tracking and monitoring your expenses through online tools like Microsoft Excel or apps such as Mint can help you understand your money patterns and is a great way to identify your budget and hold yourself accountable for your spending on an ongoing basis. As a student, we recommend outlining the below items every semester to ensure you’re on the right path to financial success and are organized come tax time.
Identify your income
First thing’s first, you need to determine how much money you’re making. Once you’ve built out a spreadsheet, create a column titled ‘Income’ and include the amount of money you’re earning, entering it on a monthly basis. This includes your earnings from a part-time job, tips, bonuses, refunds from financial aid, bursaries and loans. If you’re earning it, write it down.
Identify your expenses
In a separate column titled ‘Expenses’, include all your expenses from fees you pay monthly (rent and public transit), to personal expenses (shopping, entertainment, travel). Keep all your receipts and digitize copies when possible, saving them to a folder on your computer. Additionally, review your bank statements monthly to ensure the information is accurately captured – this is also a great way to analyze your spending trends. That new outfit you just needed to have last month may not look so great after you see your statement.
Identify your wants vs. needs
We all want to take that vacation down south and buy those new shoes, but does your budget allow it? It’s important to splurge selectively as giving into temptations can result in unwanted debt and unnecessary trouble. Remember, you should never be spending more than you’re earning. Let us help you in identifying wants vs. needs. Needs consist of food and water, shelter, clothing and health care products so everything else – a new car, designer clothing or an expensive night out, is a treat. That’s not to say that you can’t have any of those things but step one is fitting big dreams into a tighter budget. How, you ask? Here are some suggestions:
Creating and managing a budget will help you save for items on your ‘wish list’, prepare for emergencies and most importantly, ensure you’re able to live comfortably. You can also get money back on your tax return by claiming the right credits and deductions. We have a number of helpful resources specifically for students here. Alternatively, you can visit one of our offices or call us at 1-800-472-5625.