Just under a month ago, we blogged about the unfortunate circumstance of students across Canada having a rough go at trying to find summer jobs. Reports had indicated that securing employment – a necessity to help pay for school expenses – was harder than ever in the summer of 2011.
Some good news comes out today, however, as Stefania Moretti of QMI Agency reports that Canadian students are actually quite good at saving their money. A BMO study, released earlier today, confirmed that 70 per cent of the nation’s students worked a summer job this year and 50 per cent of those polled planned on using the money to pay for tuition.
The findings of the study also indicate that most students in Canada charge their expenses to their credit cards. The BMO poll found that 65 per cent of students in college use credit cards for purchases, using them about 12 times per month on average. Among the most popular purchases are clothing, groceries, transit, entertainment and electronics.
Moretti notes, however, that the tell-tale sign that Canadian students are good savers is the fact that 73 per cent of those polled pay their balances off every month. This way, they avoid lofty interest charges, ensuring that they don’t overpay for their purchases. University of Waterloo student, Stephen Lake, admits his parents warned him about how “terrible” interest charges are.
Lake estimates that we will owe at least $10,000 by the time he graduates from university. He is part of the 60 per cent of students who took BMO’s survey and answered the same way. Moretti adds that 63 per cent believe that they will be able to pay their debts off within five years of graduation.
Hopefully, then, Canadian students really do know how to save their money. But are the underestimating how heavy their debts will be? Said BMO’s Su McVey: “It’s not surprising that most students expect to have some debt when they finish their schooling, but we were concerned to see how little debt they thought they would have and how quickly they believed they could pay it off.”
Moretti writes that a Statistics Canada report released last year found that students who graduated in 2005 had average debts of $18,800. Generally, this takes a student about nine and a half years to pay off! It’s unfortunate that there are no cash advance programs for post-secondary education students. Hmmm….