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Special Reports

 

Budgeting but struggling: RBC poll finds students are pulling out all the stops to get by

TORONTO, September 9, 2008 — Most post-secondary students start the school year knowing they might be short on cash, but many say they'll get by even if it means cutting some drastic corners like food, tuition and books, according to RBC's Student Finance Opinion Poll.

If the past year is any indication of what's ahead, the poll, conducted by Ipsos Reid, found that money was tight at some point during the past school year for 60 per cent of students surveyed, with 35 per cent of them claiming it was tight all year round.

And students made some troubling compromises to get by. When funds were tight, more than half (56 per cent) said they coped by spending less money on food, while 23 per cent said they managed by not buying all the books they needed for class. Another 12 per cent said they made do by paying their tuition late.

Still, an overwhelming majority (79 per cent) are showing up for the new school year with a budget in hand, and in a show of confidence, 73 per cent say they'll stick to it.

"Budgeting for school isn't exactly a luxury these days - it's a necessity, and most students get that," says Kavita Joshi, director, Student Markets at RBC. "But even with good intentions, it can be hard to stay the course throughout the school year. There simply may not be enough cash to cover basic expenses, and while students may be working with a budget, the budget doesn't always work for them."

Now you see it, now you don't: Where the money goes
Looking back on where their money went during the last school year, current students said school-related expenses - including tuition, books, and other academic fees - accounted for 36 per cent of their total spending while in school. Food and housing made up another 36 per cent.

Among those current students who were unable to stick to their budgets, 45 per cent blamed unexpected expenses for derailing their plans. Another 13 per cent said their budget was not realistic.

Working to pay the bills and confronting debt
As some skimp and cut corners to get by, most students are also finding jobs and working to cover expenses. Seventy-six per cent said they work part time while attending school, with almost half of them (49 per cent) citing the need to pay bills as the reason.

While many students will take loans to cover school and living expenses, struggling with spending can also lead to unwanted or unnecessary debt. In fact, the poll also found that less than half (44 per cent) of students who are currently attending college or university expect to graduate debt free. That's in line with what recent grads had to say, as 54 per cent of them reported finishing school in debt even though a whopping 84 per cent thought it was important not to.

Beating those budget blues
When asked how students are managing their finances, the survey showed that almost half (48 per cent) of those polled are doing it themselves. Another 39 per cent of students are trying to do most of their financial management themselves, while seeking some help from parents and other relatives. Thirteen per cent said they are relying primarily on help from parents and relatives.

"If you blow the budget, it's not the end of the world," says Joshi. "So don't be afraid to call home for some advice, and remember that your bank can play a key role in getting you back on track too. That's why we're encouraging students to talk to us about making a budget work, managing debt, and getting the tools and advice to keep your finances on course throughout the school year and well after graduation."

For more information, including advice and tips for students, please visit www.rbcroyalbank.com/student or visit RBC's student-led online community at www.rbcp2p.com, or check out our Facebook fan page "RBC Bankbook."

These are some of the findings of an RBC poll conducted by Ipsos Reid between August 6 and August 11, 2008. This online survey of 1,167 Canadians between the ages of 18 and 35 who are students or recent students (within the past three years) of a post-secondary educational institution, was conducted via the Ipsos I-Say Online Panel, Ipsos Reid's national online panel. The results are based on a sample where quota sampling and weighting are employed to balance demographics and ensure that the sample's composition reflects that of the actual Canadian population according to Census data. With a representative sample of this size, the results are considered accurate to within ±3 percentage points, 19 times out of 20.

- 30 -

Media contacts:
Jackie Braden, RBC, Media Relations, 416-974-2124
Andrew McNeill, RBC, Media Relations, 416-955-2737


 

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09/09/2008 08:36:21