Managing your money can be tricky, but it doesn’t have to be! Here are 5 tips that can help you get started on a good path to personal finance. They include:
- Start a budget
- Hold off on Major Purchases
- Reduce Expenses
- Entertainment Money
- Kick-start your savings
Start a Budget
Just sitting down and starting a budget can often be the most difficult part. Most people don’t get joy out of sitting down and number crunching their expenses. To combat this, you should try to make a fun night out of it. Get one of your favourite meals, maybe a (small) glass of wine, and get out either a notebook or your computer. You’ll have much more fun but also be doing an important step to taking control of your finances.
If you’re not sure how to start creating a budget, feel free to use our Budget Calculator!
Hold off on Major Purchases
When you go shopping it’s easy to get swept up in the moment and spend way more than you were originally going to. The next time you see something expensive that you weren’t planning on buying, leave it for 24 hours. This cooldown period will help prevent you from impulsively buying something that you don’t really need. And if you still desperately want that item, then you can always go back to get it.
Reduce expenses
As a student, it’s much easier to reduce expenses than it is to generate income. Normally you get a lump sum at the beginning of the term (through OSAP or other savings) and that’s what you have until the next term. To reduce expenses, try setting up different accounts for different purposes. If you have some bills to pay (like your internet and cellphone) then put away money at the beginning of each month into a separate account that those bills come out of. It helps differentiate what money you have set aside for bills, and what money you have set aside for fun.
Entertainment Money
It’s important to set aside money specifically for fun! Spending time with friends and splurging every once in a while is good, and it can help create memories that last a lifetime. That being said, make sure that you set aside money every month for this very purpose, so that you don’t go overboard. This way you can spend money guilt-free because you know it’s set aside for fun.
Kick-start your savings
Just like planting a tree, it’s best to get starting saving early. Even if it’s small, it’s important to get into the habit of setting aside a bit of money. Whether it’s for emergencies or fun (or both!) there are ways to get started as a student that will help even once you’re done school. Setting up an automatic payment plan into your savings will help because it transfers money without you having to go into your bank account every month. If you have a part time job while you’re in school, you can set it up so that a portion of your money goes into your savings every payday. Even something as small as $5 might not seem like much now, but it adds up over time.