Managing your Finances during COVID-19

by Kabita Baral, GSA VP Finance and Services

Kabita Baral
GSA VP Finance and Services

November is the Financial Literacy Month. While financial literacy is important for everyone, being a graduate student puts us in a unique position in terms of our source of income and expenses we have. While it is imperative for everyone to manage their finances, this year managing finance can look a bit different owing to the pandemic we are in, which may have resulted in loss of part-time jobs for many graduate students. But not all is bad news. Owing to the ‘work-from-home’ setting, students have many different areas in our budget, where we can be a bit more flexible and spend a bit less, and thus save more.

For this year’s Financial Literacy Month, I will be talking about managing our finances during pandemic as well as some of the resources we have access to at the University of Calgary which we could utilize to our advantage.

Let’s talk about managing our finances first.

While pandemic poses unique financial challenges and opportunities, there are some basic Financial Literacy 101 that are universally applied. I will be talking about six main ways to manage finances:

  1. Keep track of your money:

Keeping track of your money means knowing what your monthly income is, your fixed expenses are and where do you have some room for flexibility. I usually take a notebook out, write down my income, my fixed expenses such as tuition, rent, electricity, phone bill and internet bill. Then there are transportation, grocery and entertainment, where we have some room for flexibility. Owing to ‘work-from-home’ scenario, most of us no longer have to commute every day, which means we could save in transportation as well as eat lunch at home. These could save us some extra bucks every week, which adds up in months.

2. Minimize debt: borrow only what you need:

As a graduate student, many of us receive stipend from our department or scholarships. However, for some students, student loan could be another source to finance grad school. It is important to consider other options (apply for all the scholarships that you are eligible for) before you consider taking student loans. More often than not, we tend to underestimate our qualification for scholarships.

3. Reassess your financial goals:

When I talk about financial goals, it could be anything. Travel plans to visit your family in your home country, vacation trips (quite unlikely during COVID), ordering foods, paying those extra bucks for that movie in Amazon Prime, shopping. The list is endless. As a grad student, we are adults but in a unique position where it is imperative for us to vent out one way or another lest we burnout. It is tempting to get that extra blouse, skipthedishes tonight or get that Xbox game you’ve been wanting to. However, it is also important to (go back to point 1) and reassess your budget and align your goals accordingly. Ask yourself: I can afford it today, but will it be at the expense of next month’s budget? It’s okay to postpone getting something nice for yourself to next month based on your budget.

4. Protect yourself from financial fraud:

With rise in internet usage because of everything shifting to online, there’s been rise in Phishing more than ever. There have been cases of fraudsters preying on people’s fear of COVID pandemic. It can be mostly via phone calls and emails. Two rules of thumb I always follow are (a) Never answer calls if I don’t have the contact saved. If they are someone you know, they will send you a text if you don’t answer. (b) If an email sounds suspicious, double check the email address. Fraudsters tend to mimic email address of someone you know or interact with often. So, a quick comparison of emails helps you flag it and then report the email as “Phishing”. Also, a government official never calls/emails you about anything finance related. They mail you a letter and they never ask for your personal information.

5. Set up an emergency fund:

Setting up an emergency fund can be a bit tricky, especially since an average grad student does not earn a lot of money. However, it is okay to save few bucks every week/month instead of not saving any. One thing that works for me is that I create a savings account and checking account. I then transfer tuition fee and few extra bucks I might have every month into my savings so that I know I cannot use it for anything else. This gives me the impression that I don’t really “have” the money that’s in savings and thus, it remains untouched until some rainy day.

6. Leverage financial resources:

All the above points might seem like too much work. But the key is to understand that it does not have to be too much work or overwhelming. There are many free resources available in official government of Canada website (link here), as well as budgeting app from mint.com which could help you track budget, spending and financial goals. Even better, we have amazing free resources available on campus (MoneySmart) specifically to assist students with financial literacy. You can attend some of the many workshops they offer or book a one-one appointment with one of the experts to assist you with your unique situation.

Take advantage of MoneySmart program by University of Calgary

MoneySmart is a resource available for free on campus for students which you can leverage to learn about budgeting, money saving strategies or financial planning. Some of the services they offer are:

  1. Financial Literacy Training: This is a module-like structure for which you can register and complete it at your own time/pace. The contents and tools will be uploaded on your D2L and you’ll have ~4 months to complete the training, after which you will receive a badge to display on your LinkedIn profile. You may either register for fall or winter term.
  2. One-One Financial planning support: If you believe your situation is unique and the “all size fits one” trainings would be less of an assistance than a one-one consultation, MoneySmart offers that as well. You’d just have to apply for an appointment and one of the experts will (e)meet with you to assist you.
  3. Resources: Besides these, MoneySmart also has resources that you can access/download and utilize to plan your budget better. They have resources on budgeting, debt management, credit, savings among others. For each of these resources, you can access details about each component of finance management as well as download free worksheets and apps.
  4. Continued Workshops: Besides these year-round available services, MoneySmart also conducts workshops throughput the year. For example, on November 19, there’s a workshop on “Managing your Finances during COVID-19”.

References:

  1. https://www.canada.ca/en/financial-consumer-agency/campaigns/financial-literacy-month.html
  2. https://www.ucalgary.ca/registrar/finances/money-smart