Budgeting Your Money

A key money management tool is a budget. It shows you how much is coming in from jobs or loans and how much needs to go out for bills and expenses. It will help you make decisions about how you spend your money on a day-to-day basis. Without a budget, you're making those decisions in the dark.

For example, if one month you're running a little short, you may choose not to go out with friends for dinner. But if it's a special event, such as a friend's birthday, you can decide to go out, but put off buying that new CD you had your eye on until next month.

Budgeting Tips
DO SOME RESEARCH. Talk to friends who've done this before about how much should you budget for groceries, internet, phone bill, furnace oil, etc.
   BE REALISTIC. If your budget shows you that you don't have enough to survive, consider your options including trimming costs or getting a job.
   LEAVE WIGGLE ROOM for unexpected expenses.

Wants vs. Needs
In preparing a budget, it's important to distinguish between "needs" and "wants". You need food to live, but going out to eat costs a lot more than eating in.

At the same time, getting out with friends is important to your mental health. The trick is finding a balance. You need a budget that is not so strict that you are constantly breaking it, or so relaxed that you are always over-spending.

Steps for Creating a Budget

Money coming in.
List all of your sources of income including money from your parents, savings, student loans, scholarships, bursaries and money from part-time jobs. If you're not sure, make as good a guess as you can. Remember that for employment income, taxes will be taken off.

Money going out.
List all of your expenses for the year.

School costs: tuition, books and course fees.
One-time expenses: moving, rental deposit, Dalplex fee, trips home, gifts.
Monthly expenses: rent, utilities (phone, furnace oil, electricity), groceries, entertainment, gas, bus, car maintenance, clothing.

Your monthly expenses will vary. And, in fact, it is the monthly expenses that you have the most control over.

If you need to pay for furnace oil, November through March will cost more than other months. Ask your landlord or the oil company for an average cost for the year, then build it into your budget.

Compare Summaries
Next, compare your expenses and your income.

In the above example, the student is going $170 over budget. They can either find more income to make up the difference, or play with some of their flexible expenses. For example, if they trim their spending money down to $75 (just $5 less per month) and can manage to spend only $870 on books by buying a few used, their budget will balance.

The lesson here is, you can't do much about fixed expenses, such as tuition or rent. But you can adjust your flexible expenses, such as spending money or groceries. If you know in advance how much you'll be short over the entire year, you can trim by just a little bit and spread out the pain as much as possible. That's the kind of control a budget gives you.

Budgeting Tools
To develop your budget, work on paper or use a spreadsheet package. There are also many online tools and calculators to help you.

If any online tool automatically includes your tuition, be sure to double-check the amount with Student Accounts.

Here are some links to a few bank tools and a form prepared by Dalhousie that you can print out and fill in. Find the right one that works for you and stick to it.

Dalhousie Student Budget Form (pdf). Print it out and fill it in.

Edulinx. A Canadian student loan service bureau. Their site includes budget and loan calculators.

The Debt-Free Grad. The students' online resource for financial advice.

RBC Budget Primer. An online, interactive worksheet.

Scotiabank Student Reality Check. An interactive application that helps you cost-out your financial needs for your entire degree.