Managing A Student Loan

Student loans can be a wonderful resource when you are going through college or university but they won’t put you on easy street. The amount of money that is given through Canada Student loans is not overly generous so you need to plan carefully. Many students has been known to skip paying bills as the school term comes to a finish and their loan runs dry! To help you avoid the end-of-term dry spells here are a few hints:

  • When your loan arrives, immediately deduct the money you need for tuition and books. Pay those bills right away. That way you aren’t tempted to spend the money on something else.
  • Take the remaining money and divide it by the number of months it has to last (usually 4 months for one term). This gives you your monthly “income”, or the amount of money you have to live on each month.
  • From each month’s income, subtract (or pay) your rent and other fixed costs (utilities, cable, phone, etc.).
  • Now, whatever money is left over is what you have for the rest of your expenses for that month. Some people like to divide what is left by 4 and give themselves a weekly allowance.

Planning how much you have to spend each week does not make more money but it does help to reduce the pain you might otherwise feel at the end of the term. Just think – if you run out of money on your weekly allowance, you are short only for a few days, not a month or more. It’s easier to make it from Thursday to Sunday with no cash instead of from early April until your final exam.

None of these tips will give you extra money but they may help you make what you have last a little longer. It’s hard not to spend the money that is sitting in your bank account early in the term unless you build in reminders of what you will need it for later on. You will really appreciate your planning in April!