Students have several options for financing their educations without entering debtor’s prison upon graduation.
Bills, loans, tuition, jobs: frightening words for young people who know little about the complex world of financial planning. Dealing with banks, the government and employers, and the labyrinth of any post-secondary institution, is a daunting task. It’s hard to know where to start.
Fortunately, there are many options for paying the bills, both at school and at home, before your credit card overheats and stress sets in, overshadowing academic success.
Carla Bodor, a first-year Business Administration student, says she initially felt overwhelmed when she added up the cost of her education.
“It was tough not knowing how much I would be receiving from student loans and where exactly I could and needed to cut my costs,” she says.
To sort everything out she made a trip to the Student Awards and Financial Aid office at Lethbridge College; she recommends other students do the same.
Linda Sprinkle, co-ordinator of Student Awards and Financial Aid, and her team assist with student loans, scholarships and awards, and budgeting. She advises students to get on the right track early and save themselves a lot of stress by erasing any debt they have before beginning their college studies.
“Prior to school, prospective students should do all they can to reduce their debt load (paying off a mortgage is neither likely nor necessary), so that the stress of studies is not compounded by the stress of debt management,” says Sprinkle.
It’s unlikely you’ll be able to get ahead financially while in school full-time, especially while on student loans. But starting your post-secondary career when you’re already behind is a recipe for disaster. Sprinkle advises tackling as many debts as possible before your classes start: expenses will pile up quickly and you don’t want to start your semester already in the red.
As a new student, you can also obtain advice at the start of your first semester. ATB Financial sponsors College Life 101, the new-student orientation event, to outline finance options. Jim Kellington, market manager for the Lethbridge region, says his staff is armed with a wealth of information, including the Students First Plan.
This comprehensive plan offers students a bank account with low fees, a MasterCard and a line of credit. Kellington says ATB staff educate students on the benefits of credit cards and establishing good credit.
Attending college isn’t cheap. Between the money spent on tuition, books, accommodation, food and other supplies, college students often have little flexibility in their budgets. The average cost for tuition, fees and books for Lethbridge College programs in the 2011-2012 academic year is $6,000 and change.
“Oddly enough, tuition, fees, and books and supplies are typically not the major expenditures for many students,” says Sprinkle. “Anyone who cannot live with their parents is going to face considerable expense just living for eight or nine months.”
When Student Awards and Financial Aid staff help students establish a budget, they base the estimated living allowance at $941 a month for a single student with no dependents living away from home. This amount is expected to cover living costs, but many students will have higher expenses, especially if they have vehicle payments. Students on loans are allowed to make additional monthly payments of $800 to help them get by. It is important to remember that start-up living expenses will set you back as well. In the first month, students should factor in damage deposits, and stocking cupboards with essential supplies. Joey Sugai, second-year Communication Arts student, recommends paying bills right away.
