How to do it and why it is crucial for your future
In an interview with Alice Pelkman, the University of Guelph’s manager of Financial Aid in the Student Financial Services office, some of the most important information was discussed in terms of the financial forecast for students and recent graduates. The first step, as most of you would have already discovered, is creating your budget. It isn’t as simple as tracking the total sum of money you have and estimating what you will spend. The truth of the matter is, what you anticipate spending and what you will actually spend will turn out quite differently if you aren’t diligent in tracking your spending on a weekly basis. This may sound like extra work – but it is well worth it. It is something that you can do to make your stay at university more enjoyable and less stressful.
This being the beginning of a new semester, it is an ideal time to sit down and create something to stick to for the next year. Whether you are receiving student loans via OSAP and the National Student Loans Centre (NSLC) or receiving funding from student lines of credit from a financial institution, it is time to be serious and figure out your financial standing.
As an on-campus student living in residence, there is a slightly smaller worry when it comes to figuring out your budget, because you do not have the need to add in housing costs such as rent and utilities (gas, hydro, internet, cable, etc.). Even though you may not have to deal with these things now, you should be sure to keep them in mind for the future.
If you are living on campus and are receiving some funding, you need to plan out a budget that consists of expenses like books, entertainment, food, and an emergency fund (which everyone should have – you never know what may come up). There is a difference between wants and needs when making a budget – make sure to keep in mind what you actually need vs. what you really want.
Books: The cost of your textbooks may surprise you. Depending on your area of study, textbooks will vary in price, but expect to spend a minimum of $500 each semester.
Tuition: Tuition is a set number for each semester; it is one of the heftiest amounts you will be obligated to shell out. Remember that fall tuition is typically slightly higher than the winter tuition, as you are paying a lot of your student fees. In these student fees, you will find health and dental benefits that you can choose to opt out of if you have coverage from your parents. If you do not have coverage, keep them and use them to keep healthy over the year.
Entertainment and travel: Things like going out for drinks, dinner, and other events like concerts, plays, movies, or a weekend away, can also be important expenses. These are mainly wants, but they may also be leisurely activities that will benefit your overall well-being if you can afford to do them once in a while.
Food: Although you are likely on a meal plan as a first-year student, keep track of the status of your meal plan account. Running out of money on your meal plan consists of loading it back up with enough money to keep you fed the remainder of the year. This is real money; use it wisely. You may also wish to purchase select items at the grocery store to keep in your room and mini-fridge. Keep a grocery budget; although, for the most part, you will likely use your meal plan.
Last, but not least – and this goes for everyone – keep an emergency fund. An emergency fund should be something that you can turn to when you have something that needs to be tended to – such as an unexpected trip home, the loss of a part time job, not receiving as much funding as you expected, or an outrageous cell phone bill.
For those who are living off-campus, or are looking to live off-campus next year, some really important things to keep in mind are rent, utilities, transportation, and location.
Rent: When looking for a place to rent, before anything else, inform yourself of the Landlord and tenants Act and read over leases very carefully; be sure to ask questions and look for advice if needed. This is a legal document and is not to be overlooked out of excitement.
Next, have a budget going into a place and figure out whether or not utilities – such as gas and hydro – are included. If they are not, make sure your rent isn’t so high that you can’t afford your utility bills. Bills fluctuate month to month, and your hydro and gas bills will fluctuate throughout the seasons.
Last, but not least – and this goes for everyone – keep an emergency fund.
Utilities are not cheap! If you find a place that is $350 for rent but does not include utilities, and also find a place that is $500 all utilities included, it may not seem like it, but the $500 room with utilities included is the better deal. Not only do you not have to worry about the hydro bill spiking due to baseboard or electric heat in the winter, but you also do not have the worry of gathering money from your roommates each month when splitting the bills up evenly. If you do have to pay your utilities, it is a good experience, and you will at some point need to become responsible for these tasks. However, make sure that you have an agreement between roommates to ensure disagreements do not occur.
Debate having a car: They may seem convenient, but take into account that you have a bus pass that is included as a part of your tuition and student fees. Public transit gets easier as the years go on – get on the bus! If you choose to have a car, make sure to keep in mind the cost of gas, parking passes, parking tickets, the lack of parking, insurance, and upkeep.
Location: Living near campus is very convenient, but over the years, you may want to venture out into the city and really discover what Guelph has to offer. Be sure to choose your location wisely so you can get to campus via public transit, and time your commute accordingly so you make it to as many classes as possible to get the most out of your degree.
If you are feeling overwhelmed and need a hand looking at your budget or sticking to it, there are plenty of services on campus that can enable you to make good choices. You can call and make an appointment with a financial advisor; their office is located on the third floor of the University Centre and they can help you with all of these concerns. There are also plenty of apps available for your cell phone that will calculate your budget; or, you can do it the old fashioned with a pen and a paper. Set up online banking if you haven’t done so already, and keep track of the money going in and coming out of your account. There is nothing worse than being stressed when you are running out of funds and have exams to worry about. The sooner you get a hold of this, the better off you will be and the better prepared you will be for your financial future.