As a student, it can be easy to get distracted and lose track of your finances. It is not uncommon to face unexpected circumstances and end up short on money to cover expenses. However, this can be avoided through planning and consistently monitoring your finances.
1. Managing part-time income
It can help to work part time during university, to have a consistent inflow of cash, and cover the basic expenses — such as food, transportation, and for some cases, rent. Regardless of working part time or not, it’s crucial to live within your means. Spending money you don’t have (i.e. using credit cards) can be a downward spiral for your finances, and negatively impact your credit score. A general rule of thumb is to have a credit score above 680 (which is considered ‘good’).
2. Managing your credit
Credit is something that is a huge part of our lives nowadays — from dating, to finding a job, even to renting or buying a place. Fun fact: 42% of adults admit that their partner’s credit score can affect their willingness to date them (MarketWatch). I suggest monitoring your credit score/report through a credit reporting website, or through your online banking platform. There are various ways to improve/maintain good credit, such as keeping your balances low, paying off on time, and limiting your credit inquiries. These little things go a long way to maintaining a healthy score.
3. Student loans
In reality, a good chunk of students have debt to pay off after graduation. If you’re working full time during the summer, it’d be wise to start saving up (and investing) those funds so you’d have the financial capability to start paying down your student loans aggressively during university and/or after graduation. This would reduce your total debt servicing ratio (TDS), which equates to a stronger credit report.
Jelani Smith is a personal finance guru with a passion for real estate & personal finance. He is a real estate agent at Zoocasa and is the managing editor & founder of Bay Street Blog, a Millennial Finance Hub. He envisions the blog to improve the financial literacy rates among millennials. Jelani bought his first home in Toronto as a recent-grad and looks forward to sharing his knowledge with students & recent grads.
