71 12.2 Personal Budget
There are many different ways of paying for educational expenses. When creating your own financial plan for school, you may wish to consider:
- Working to save for tuition and expenses before attending.
- Working during summer months to pay for your school semester.
- Working part-time and attending school part-time.
- Cutting down on living expenses by living with family or in student housing.
- Applying for grants, bursaries, or scholarships.
- Requesting support from family.
- Applying for student loans.
Exercise: Financial Aid
Talk to someone from the financial aid office at your school of choice. The people in this office may suggest other options for funding that you are not aware of.
Jot down some notes after talking with the financial aid people. You may need these notes for your Budget assignment (coming soon!).
Making a Budget
A budget is a document that tracks the money you have coming in including sources of income, and the money you have going out to pay for your expenses. For students, a budget helps them plan for future school expenses, keeping in mind all sources of income, including student loans, grants and earnings from part-time work or full-time summer jobs.
When returning to school, most people have to really think about their needs versus their wants:
| Needs | Wants |
|---|---|
|
|
You may have to let go of some wants when you return to school. Can you think of some wants you could eliminate from your budget while you are a student? How about making coffee instead of buying coffee? Buying less clothing? Going out to movies less often and staying home to watch one instead? You may find it is easier to eliminate some expenses that are wants rather than needs.
Exercise: Saving Money
List as many ways as you can that you can cut back on expenses in your own personal life. Make sure they are practical and doable. For example, it may not be practical to save money on a bus pass if the alternative is walking to school one and a half hours each way. This will help your fitness level but may seriously cut into your study time, so it is likely not worth the savings. Likely you will think of many practical areas you can save money though.
Also remember that budgets get adjusted regularly, so you’ll have to review your budget often. Add income that may come in, such as bursaries or income tax returns, to keep your budget accurate.
Exercise: Prepare a Simple Budget
Using your word processor program, prepare a simple budget showing how you would pay for 1 year of your program at a post-secondary institution. The easiest way to start is to break down your monthly expenses and add the costs associated with school. You will have to estimate expenses for many items (e.g. food, hydro)
Be sure to include your costs for:
- Accommodation – rent, mortgage, or student residence (example: $800 per month times 12 months)
- Hydro (example: $85 per month times 12 months)
- Food
- Personal care items
- Childcare (if necessary)