Create your budget
What needs to be acknowledged first and foremost is that students’ financial situations vary significantly. There will be people who read this column who have tuition paid for, along with a car, rent, and spending money; there will also be students who use services like the CSA food bank and really struggle to make it from fall to winter OSAP disbursement; there will also be a bunch of you whose financial situations lie somewhere in between these two extremes.
This column will not provide the financial advise that should be sought out by a professional financial planner. There are resources available to you free of charge both through financial services at the university and your bank that you can take advantage of if you feel the need. What this column does provide is insight into the world of being a student from a financial perspective. A lot of the time students’ can feel overwhelmed in what can feel like a sea of debt, there may be situations where we can feel like we’re not able to do the things we want to or buy the things we want to because we simply just don’t have the money. That is what perfecting being perpetually poor is all about – learning that you’re not alone. That although it can seem like many of your friends are financially stable enough to go to the bars three days a week, or go out for dinner regularly or even take cabs home instead of hopping on the drunk bus, there are still so many people in a similar financial situation as you.
As we begin the semester, we start with a clean slate. In some cases, we’re receiving our fall OSAP disbursements, some students are diving into their new lines of credit, some students are finding employment in the city, and some students are being allocated sums of money or allowances from their parents. Whatever your financial situation is, now is the time to create your budget. When you’re creating your budget, you need to create an exhaustive list of expenses that will arise over the entirety of the budgeting period. Consider things more broad than those conventionally thought of (i.e. rent, food, utilities, entertainment, phone bills, line of credit payments), but consider everything you have to pay for before the next time you’ll receive money. If you receive OSAP, remember to budget January’s rent in. You don’t receive the second disbursement until after Jan. 1. Recognize that Christmas, as well as some of your friends’ birthdays may be in this time and that even though they may not expect a gift, they probably expect to spend some time with you which may involve a bar night or a dinner out.
Be realistic with your budget, and more importantly – be realistic with your spending habits. If you’re someone who is notorious for shopping sprees, if you often check your dwindling bank balance just days after getting paid only to wonder “Where did all that money even go?” you should consider creating a spreadsheet to track your spending. It’s one thing to be the one spending your money, but it’s another thing to see where it goes. These days, major banks have resources for you to go online and see where your money goes. You can assess the results on your own or talk to a personal financial planner to see if you can make cut backs that may be necessary.
Remember to give yourself some wiggle room. There is nothing worse than having an extravagant night that leaves you penniless and wondering how you’re going to manage to eat until you get some cash.
Find out what works for you. Some people keep their money allocated in a number of envelopes, some people need different accounts for different budget allocation categories, and some people use their credit cards for everything and pay it off right away. Just because your friends (or your parents) handle their finances one way that does not mean that it will work for you as well. Take some time to really figure out a system for yourself and you will appreciate it soon enough. If you find that you absolutely cannot restrain yourself from spending, ask your parents to give you an allowance versus a lump sum, or open a tax free savings account or another account that doesn’t let you access your money immediately. Be very strict with yourself until you’re able to trust yourself with your own money.