Freedom 55 Financial

Five money mistakes common to post-secondary students

Learn about the pitfalls many students encounter while at school.

1. Overusing credit cards

They’re a familiar sight at college and university orientation events across the country – representatives from major credit card companies offering free event tickets or merchandise if you sign up with them. While young people are often excited to get their first credit card, credit card companies know many students won’t be able to make their payments on time.

Prove them wrong by paying off your balance each month before it accrues interest. This can also help build a good credit rating, which will come in handy when it’s time to borrow money for a car or a home later on. Also, keep an eye out for a credit card that offers a low interest rate. Many student cards do.

2. Abusing student loans

Remember that, while student loans offer low interest rates and interest-free terms, they’re designed to help pay for your education, not shopping sprees. If you dip into your student loan too often, you may need to get a part-time job, which could distract you from your studies.

3. Not thinking about career plans

Sometimes taking a degree, diploma or certification in what you love means you’ll struggle to find a job once you’re finished school. Unfortunately, an education alone may not be enough to guarantee you a job after graduation.

Talk to people who’ve graduated with the same education. How long did it take them to find a job? What did they wish they’d done differently? LinkedIn was built for this, so use it to your advantage. Boost your resume now by signing up for supplemental courses, internships, a club, or volunteer opportunities. It’s important to recognize that, while all employers will look at your education, they’re also interested in your interpersonal and leadership skills.

4. Giving out financial information

1Nearly one-third of all identity thefts happen to people between the ages of 18 and 29. Only use secure networks when sharing personal or financial information. Look for “https” at the beginning of the web address to ensure it’s a secure site.

It’s also important to avoid sharing credit cards and co-signing loans with friends. They may be a friend now but they could be a financial foe tomorrow, potentially leaving you with their debt.

5. Forgoing a spending or financial security plan

Many students spend first and ask questions later – a formula for landing in financial hot water. Budgeting is an invaluable tool for helping you stay on top of your finances. It’s important to cover your fixed expenses (rent, tuition, groceries) before you allocate your variable expenses (going to the movies, dining out, etc.). Budgeting websites can really help with this by categorizing your money automatically, meaning you have one less thing to worry about. These sites can even send weekly updates on your financial situation, keeping you in the loop.

Even at this stage in your life it’s important to identify your financial goals. With the help of a financial professional, you can create a plan that includes saving for all the things you want to do once you graduate.

Going into debt in your 20s isn’t the end of the world; sometimes, it’s a necessity. Although financial security planning is rarely taught in school, if you have the foresight to stay on top of your finances, you’ll have a leg up on many of your peers.


1Public Safety Canada, “A Report to the Minister of Public Safety Canada and the Attorney General of the United States,” Bi-national Working Group on Cross-Border Mass Marketing Fraud, October 2004.


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