Bawa is a second-year business student and the vice-president of the business society at the University of Guelph-Humber. She said she learned her lesson the hard way when she had to manage buying a new phone. Since that event, she has started to think about her purchases in order to prepare for unexpected expenses.
As a way of preparing for sudden expenses, Bawa began to put money aside into her savings account. Although she doesn’t have a budget, by working during holidays she is able to save around $3,000 to prepare for unexpected expenses.
Joaquim Creswell, fourth-year business student and president of the finance society at the University of Guelph-Humber has adopted a similar mentality.
Creswell has been interested in finance since he was a child. He said he reads a lot of personal financial planning books and applies the suggestions in different situations. He was well-prepared when his car broke down a few times unexpectedly during his time at university.
“I am all about efficiency, I won’t spend $100 if spending $50 is good enough.”
- Joaquim Creswell, President of the Guelph-Humber Finance Society
Ahmed Bashir, finance professor at the University of Guelph-Humber, suggests that students make a budget if they are struggling to save money. Bashir said making a budget sounds daunting, but it isn’t. It can be as simple as making a table with two columns: cash-in and cash-out.
Bashir said cash-in would account for wherever the money is coming from, whether it is income or loans. In the cash-out column, he said, “you should put all the expenses that you are going to pay.”
Students can make this budget table on programs such as Microsoft Excel or by simply writing it down. He recommends using Excel because students can easily download the program on their phone and keep track of their budget.
Bashir said it is important to keep track of all expenses no matter how small they are. There are some things that are easier to keep track of like phone bills and transportation costs.
Using a credit card to make payments also helps students who want to track their budget easier. However, Bashir said, “it is important to pay the bill on time because you can get a penalty or get charged interest.” He said it’s helpful to regularly check bank statements.
Creswell said whenever he gets a pay cheque, he saves about 10 per cent to 20 per cent for unexpected costs. When making his budget, he said, “it is important to determine what is absolutely necessary for you to spend the money on and what you can splurge on.”
Both Bashir and Creswell gave the example of shopping around for the best phone deal. Creswell said, “you can spend anywhere from $50 to $120 a month for your phone bill.” He said students should analyze their plan and reduce their costs by eliminating the features that they don’t use.
Bashir said students should research about different offers from phone companies. He said, “if there are no offers do not sign up for a long-term contract.”
According to Bashir, regularly eating out is one of the main obstacles to saving well. He said reducing eating at restaurants can help save more money. He said going grocery shopping often can help student reduce their expenses.
Grocery stores publish flyers on a weekly basis. Bashir suggests students to look at different flyers to buy food on sale. He said, “grocery stores have certain bait items. One or two items will be very cheap, but some other items won’t be.” Hence, it’s beneficial to look at the weekly flyers from variety of grocery stores.
Bashir also suggested ways to use transportation in a cost-effective manner. He said, “if you are driving, then carpool. Find out who lives near you and you can take turns driving weekly which will cut down your expenses on gasoline.” By carpooling, students will socialize with people.
In regards to TTC monthly passes, Bashir said they’re only worth it if a student uses public transit more than 10 times per week. If students do not spend a lot of time using transit, then he said they may be better off using tokens.