Last week I encouraged students to get a job to help put a dent in hefty tuition bills. Many readers agreed. Others thought the column failed to address the larger social issue; that education in Canada has become obscenely expensive. I agree that the costs are extreme.
Students graduate with great career aspirations, loads of debt and a tough Canadian job market.
But, political and social views aside; students still have to find smart ways to manage their finances.
Students, working a part-time job to pay the bills is a great way cover costs, gain experience and meet people. And, work experience will make you highly marketable to employers!
If a job related to your field of study isn’t available, try another industry. Eclectic experiences look great on a resumé and help diversify your skills. Or, become an entrepreneur and cut grass, deliver groceries, write or freelance. Whatever you do, work hard, add value, be personable and get references.
Educational funds are also available through student loans and lines of credit. But, with debt comes responsibility; only take what you need.
Draw up a budget. Using a spreadsheet or online banking budget tracking tool, list income and expenses (big and small).
Apply ‘Financial Bootstrapping’ techniques to live financially lean and frugal; reduce cellphone bills, dinners out, negotiate for better rental rates or move to a smaller place. Buy text books, laptops, desks and furniture second hand.
File a tax return. Even though you don’t make significant income, by filing a tax return you begin accruing tax deductible RRSP contribution room for future years when you’ll earn greater income. You’re also entitled to receive a GST/HST credit, which can amount to hundreds of dollars in cash. If you’re using student loans, you can claim federal and provincial tax credits for the interest paid throughout the year.
During tax season, students can claim valuable tuition credits, receive an education credit of $400 a month for full-time enrolment, and a textbook tax credit of $65 a month.
Unused credits can be carried forward into the future when a student earns more income.
Paying for school is difficult and it takes time to chip away at loans. But you’re making an investment in your future. Education will open doors for you in terms of your career and lifestyle.