Creating a Working Budget – 5 Tips to Remember
Being a college or university student is a learning experience through and through. Not only do you learn the necessary skills to flourish in your future career, but you also learn how to survive in the real world. Among the long list of real-life survival skills you get to test out as a student, is being finance- savvy.
Being free of financial troubles while in college or university is not as much a Herculean task as many believe, but it is indeed a challenging one, especially in these times when the Canadian dollar has hit its lowest rate in 13 years. However, if you are completely aware of your finances from the start, it would mean smooth sailing for you. Below are some suggestions on creating a working budget.
1) Note all your assets.
The first step in establishing a working budget is to know how much you have. Students like you have a variety of sources of income, and you should note them down. Such sources include income from part-time jobs, scholarships, grants, or bursaries, and financial support from family. Include everything you have accumulated since you started your post-secondary education—even that cash gift you got from your grandparents last Christmas.
2) Note all your expenses.
Now this is the part where it gets a bit tricky. This is because expenses are never actually constant for any college or university students. There are some fixed expenses like credit card bills or phone bills, but there will always be times where you have to spend extra on school projects or supplies and other school-related stuff. Of course, college and university life also equals honing your social skills and bonding with fellow students, and you would most likely find yourself allocating your budget for entertainment expenses such as concert or movie tickets. Remember, however, that when it comes to expenses, it’s always better to overestimate than underestimate.
3) Plan your emergency money.
As a kid, you were always reminded by your parents that it is wise to save money for a rainy day; over time, you would come to realize how valuable that piece of advice was. Having a set budget for school-related costs is one thing, but what will you do for emergencies? For instance, suppose your car breaks down, and you need a new battery. Or your computer finally gives out and is beyond repair and you have to buy a new one. A true finance-savvy student is one who sets aside money for emergencies.
4) Do a monthly budget review.
Businesses and corporations make it a point to do a monthly review so they know where they stand. They know when to cut operating costs, when to hire additional staff, and when to give bonuses. You can follow their example by reviewing your budget on a monthly basis. This way, you’ll know if you have to cut down on your expenses or give yourself a treat.
5) Be on the lookout for opportunities to save.
Be open-minded and resourceful when it comes to money-saving opportunities. For instance, you probably know how textbooks can run your wallet empty, so look into options of renting books or buying used books instead. When it comes to clothing, on the other hand, keep in mind there are stores that specifically offer student discounts, so it is good to take advantage of that as well.