How to Survive on a Student Budget

Budgeting your monthly income can be a tedious affair. Figuring out how much money is coming in for the month, what needs to be paid (such as rent and phone bill), what you need to buy (such as food) and what’s left over to either save or use to have a little bit of fun and go hang out with some friends. It can be very overwhelming.  It can be especially overwhelming with the added expenses of tuition, books and supplies

So, how does one survive on a student budget? What do you need to do to make sure everything is budgeted properly? How do you ensure that all of your bills and expenses are covered every month?

The TD Canada Trust Bank website offers four steps a student should take when trying to manage and create their budget:

1) Calculate Money Coming In

2) Calculate Your Expenses

3) Calculate Your Balance

4) Revisit Your Student Budget Every Term

Step 1) Calculate Money Coming In

The first thing you should do when trying to budget your money, is list all of the money you have coming in. This can include such things as any hours worked at a job (full-time or part-time), student loans, money from any scholarships and/or bursaries, money from your parents and interest from a savings account or any investments you may have.

Once you’ve made your list, add it all up to find out your monthly income based on the months you expect to be in school for (usually from September to April if you’re a full-time student).

Step 2) Calculate Your Expenses

The next thing you need to do when trying to budget, is list all of your expenses for an average month. This can include such things as tuition, books and supplies, food, rent, phone and internet, utilities, personal products like clothes, shampoo and soap (which I would count as part of my groceries, except for clothes which I would count as extra), insurance (whether it be health (health benefits are now usually included in your tuition), tenant or car) and entertainment (going to the movies).

Step 3) Calculate Your Balance

Once you have made all of your lists of incomes and expenses, you need to calculate the total balance that it all comes to. Now, when you do this, your balance can either come out positive or negative.

If your balance comes out in the positive, that’s fantastic because that means you have more than you originally thought and you can relax knowing that all of your bases are covered. And instead of just throwing the extra money away on another case of beer or another night out on the town (which you can if you want because being a student is a lot of hard work and you deserve to have some fun), put it on your credit card if you still owe some on it or save it and put it away in the bank for a rainy day. You never know when you might need it.

If your balance comes out in the negative, then you have a problem. It means you’ve over budgeted with your expenses and some stuff has to go. Try cutting back on unnecessary things, such as too much money spent on going out with friends or buying tons of cases of beer. Or, if you’re getting a credit card (which you might not want to get at all because that can just get you into more financial trouble), get one that works for you and your budget with lower interest rates and/or that offers points and rebates that you can use such as travel points or airmiles. And, if you want to cover yourself in case you fall short, look into getting overdraft protection on your bank account and/or a student line of credit that you can access for a source of extra money when you need it.

Step 4) Revisit Your Student Budget Every Term

Your last step when managing your student income is to make sure you revisit your budget every semester because your financial situation may change in a few months, or even a few weeks, such as your rent might go up or your books may cost more or you might get a car, and then you’ll need to adjust your budget accordingly.

Personally, I don’t agree with TD’s step number four. You should revisit your student budget every month, not every term because your income may be different from month to month, especially a student’s income. Unless, of course, you’re working study hours every week while going to school but even then I would still look at it every month.

And even when you are no longer a student (like myself) I would still look at my income every month and budget accordingly to ensure all of your bills and necessities get paid.

So when you are trying to live on that small student income, remember to follow the four steps on how to manage your money –  as recommended above.

And if you are ever struggling to meet your monthly expenses, and you need help with your budgeting, ask your parents to help you work it out, or go to your bank and make an appointment with a representative to go over your budget with you.

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