When it comes to managing cash flow, or lack thereof, today's students have a lot of competing financial demands. An RBC survey found that 48% of post-secondary students enjoy being responsible for their own finances. Yet 37% of students say that managing their finances while in school is harder than they had expected.
"Financial independence doesn't necessarily mean having a certain amount of money in the bank, or being debt-free," said Melissa Jarman, director, Student Banking, RBC.
"Independence means having the autonomy to make your own financial decisions. It helps to plan ahead and keep a budget. This will help ensure your money lasts until the end of the month, and the end of the year."
Jarman offers three financial tips for students:
• Live below your means: The key is to spend less in a month than you bring in. When you create your budget, leave yourself some wiggle room so you don't spend up to or above your limit. To do this, you need to understand how much money you have available to spend and how much money you have going out. Tools such as RBC's myFinanceTracker and the Spend-o-meter can help put you in the driver's seat when it comes to tracking and managing your finances.
• Rethink your spending: Once you have an idea of where you are spending your money, you can take control of your expenses by separating the “must have” from the “nice to have.” Discretionary spending on things like coffee and take out can quickly eat away at your budget. Figure out which of the “nice to have” are most important to you, and cut back on the rest.
• Check back periodically: After creating a budget, most people have the best intentions. To stay on track, you need to review it periodically to make sure you are sticking to it, and to update it as necessary.
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