Money Tips for Incoming College and University Students

New-found freedom and an early taste of adulthood await many young people starting post-secondary education this fall.

With that freedom comes new responsibilities: attending classes and studying while also maintaining a social life, taking care of chores and meals, and possibly holding a part-time job—all while keeping an eye on debt and other financial obligations.

“A lot of things change financially for you when you turn 18,” said Shannon Lee Simmons, a Certified Financial Planner and founder of New School of Finance. Students entering post-secondary may apply for credit cards, open a chequing account, and become responsible for day-to-day costs. “There’s big financial stakes and your first time doing it in a big way, all happening at the same time.”

Research and surveys over the years have highlighted the financial pressures on students as tuition, textbooks and living costs rise. A 2024 Canadian Alliance of Student Associations survey reported that more than two-thirds of students expect to graduate with debt and found the average annual cost of living for students was $28,731.60.

Student money guide

How to pay for school and have a life — a practical guide for students and parents

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Build good financial habits from the start

Establishing healthy financial habits early makes managing money less stressful and more automatic. This is an ideal time to form routines and rules that will carry into later life.

“This is the time in your life in which you formulate habits,” said Bruce Sellery, CEO of Credit Canada. One foundational mindset he recommends is simple: live within your means. If you don’t have the money, don’t spend it. “This is a habit. It is a skill. It is a value. It will serve you for the rest of your life.”

Before classes begin, consider creating a 12‑month financial plan. List all income sources—savings, registered education savings plans (RESPs), summer or part-time work, and any student loans—then list expected expenses like tuition, textbooks, rent, groceries and transportation. The goal is to see whether your income can cover those expenses and where you may need to cut back or find extra income. “With school, there are limited resources and lots of expenses,” Simmons said. “So, we sort of have to squeeze our life into whatever is left over at the end of it.”

Understand the terms of student loans

If you need to borrow, learn exactly what you’re borrowing and why. Borrow only what is necessary rather than taking the maximum available. The larger the loan, the more you’ll owe later.

Make sure you know the interest rate, when interest starts to accrue, and the repayment schedule before signing any agreement. Understanding these terms helps avoid surprises and makes it clearer how a loan will affect your budget after graduation.

Create a realistic spending plan

A sustainable spending plan starts with a clear analysis of cash flow: list your incomes and your expenses to determine whether you have a surplus or a deficit. If you’re spending more than you earn, identify realistic ways to close the gap.

Brainstorm options to reduce spending or boost income: cut back on takeout, share housing costs, work a few hours a week, buy used textbooks, or ask family for temporary help. Choose two or three concrete changes and commit to them. Trying to change too many behaviors at once makes it harder to stick with any of them.

Pay attention to everyday expenses

When you first move out, everyday costs that were previously hidden—like shampoo, laundry detergent or groceries—can add up. Simmons recommends daily or weekly check-ins at first to learn what your actual expenses are. Tracking spending for a short period helps you understand patterns and identify small, frequent costs that can be trimmed.

While obsessively tracking every dollar isn’t for everyone, a focused learning period can be valuable when you’re new to managing your own household expenses. Use a simple spreadsheet, budgeting app, or even a small notebook to record typical purchases and build realistic expectations.

Practical tips for students

Create a simple monthly budget that lists fixed costs (rent, tuition, phone) and variable costs (food, transit, entertainment).
Prioritize essentials and set limits for discretionary spending; treat savings and loan payments as regular expenses.
Consider part-time work that fits your class schedule to reduce reliance on credit.
Look for discounts and student pricing for transit, software, and entertainment to lower costs without sacrificing quality of life.
Keep emergency savings, even a small buffer, to cover unexpected expenses and avoid high-interest borrowing.
Ask questions about loans, grants and bursaries at your school’s financial aid office so you fully understand your options.