November marks Financial Literacy Month in Canada, a time when the importance of healthy spending habits is highlighted. It’s also a time when post-secondary students in their final year really start to feel the pressure of graduation. Many of them may be lacking in terms of money management.

The Ryersonian‘s Robert Liwanag spoke to Mandy Mail, director of student banking at RBC, to outline some starting points for graduating students.

Budgeting, credit cards and goal-setting are important for graduates. (Tiffany Crawford / Ryersonian Staff)

Budgeting, credit cards and goal-setting are important for graduates (Tiffany Crawford / Ryersonian Staff)

Figure out your budget

Being a student at Ryerson means spending money on both necessary and unnecessary things. Mail, however, says it’s important for graduating students to not only live within their means, but below them.

“The first time someone has an income, it’s really easy for them to spend money,” said Mail. “It’s absolutely OK to splurge occasionally, but you need to have a budget and prioritize.”

A steady income doesn’t mean you should be living large, especially at a time when Ontario’s unemployment rates for people aged 15 to 24 is higher than the national average. Decide what you can live without, create a monthly budget, and stick to it.

Be careful with credit cards

Along with tuition costs and unplanned expenses, Mail says student debt also comes from a misunderstanding of what credit cards are and how they work. This means that small purchases can make an impact later on for graduating students trying to reduce their debt.

“It’s really important when you graduate that you understand what loans you’ve taken out and the details of those loans,” said Mail. “That means paying off the loans with the highest interest rates first, and working your way from there.”

While credit cards can be useful for making online purchases or earning rewards, Mail says many students increase their limits and make minimum payments only.

Moral of the story? Only use your credit card when you really have to.

Prioritize your goals

Mail says that adults should have four financial goals — retirement, planning for emergencies, paying down debt and saving for major expenses like a vacation or car. But for many Ryerson students in their final year, moving out of their parents’ home might be the main one.

“It’s really hard to land a job nowadays that’s going to help you earn money, move out and pay off debt all at the same time,” said Mail. “It’s important for recent grads or students about to graduate to really prioritize what you want to do with your earnings.”

If you’re lucky enough to find a full-time job straight out of school, what’s more important — moving out right away or paying off your OSAP loans? You probably can’t do both.

This article was published in the print edition of The Ryersonian on Nov. 11, 2015.

Robert is in his final year at the Ryerson School of Journalism. Follow him on Twitter @rrobertl

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