If you’re a university or college student, you’re probably getting ready to head back to campus. This year, in addition to all the courses you may be taking, how about trying to master some financial lessons, too?
Of course, many students already have at least one foot in the “real world” because they’re not just taking classes — they’re also working many hours a week to help pay for school, rent and living expenses. But even if you’re a full-time student, living on campus and paying for school through a combination of grants, loans, savings and help from your parents, you can learn some financial basics that can help you throughout your adult life.
Here are a few suggestions you might want to consider:
• Don’t overuse credit cards. Credit card marketers aggressively target students, so you’ll need to be vigilant about all the offers that will bombard you. While it might not be a bad idea to carry a single credit card for use in emergencies, it’s very easy to overuse the “plastic” and rack up big debts. You’ll need to discipline yourself to save for the things you want, rather than charging them.
• Shop around for financial services. You might find companies willing to give you a T-shirt or a frying pan for opening an account with them. But they may not be offering you the best deal on chequing or savings accounts or loans, so it pays to shop around.
• Keep track of your student loans. Make sure you understand all the terms of your student loans: how much you’re expected to pay each month, when payments are due, what interest rate you’re paying, what credits may be available for on-time repayment, etc. You might be able to achieve a more favourable repayment schedule by consolidating two or more loans. Once you start repaying your loans, do whatever you can to stay on track with your payments.
• Never stop looking for financial aid. The aid package you may have received in your first year on campus doesn’t have to be the final word on financial assistance. For example, some universities may offer scholarships based on post-secondary academic achievement and/or real-world experience. Study your institution’s scholarships and be aggressive in going after them.
• Estimate your future income. You may not know exactly what you want to do when you graduate, but if you have a career path in mind, try to learn what sort of salary you can expect during your first few years after your days as a student end. Once you have a realistic idea of how much you’re going to earn, you may have the motivation you need to avoid bad financial practices, such as accumulating big debts.
Life after high school should be a learning experience — in many ways. And if some of the knowledge you obtain during your post-secondary years can help you develop sound financial habits, so much the better.
Jodi Nastor, CFP
390 McNabb Street Unit 2