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BMO Bank of Montreal

October 07, 2010 08:15 ET

BMO Report: Students Packed Their Bags, But Not Their Budgets

- 81 per cent of post-secondary students say a budget is important, but less than half prepared one

- Only 13 per cent say they keep track of their spending and stay within their budget

- Books, tuition and rent have been paid, but 4 out of 10 are concerned they won't have enough money for the rest of the school year

TORONTO, ONTARIO--(Marketwire - Oct. 7, 2010) - The majority of Canadian university and college students (81 per cent) agree it's important to have a budget to manage finances during the school year, but 6 out of 10 did not prepare one before heading off to school, according to a new survey from BMO Bank of Montreal.

The report, conducted by Leger Marketing, was done with students during the month of September as they adjusted to the reality of a new school year. The report also found:

  • 40 per cent of students are concerned they will not have enough money to cover the remainder of the school year
  • 63 per cent of those concerned plan to cut spending, while only 1 in 3 said they would start a budget
  • The majority of those with a budget say they have needed to make revisions since school started 

"During the Thanksgiving long weekend, many students will be home for the first time since the school year started, and it will be a good opportunity for students and their parents to review their finances together," said Su McVey, Vice President, BMO Bank of Montreal. "While the report clearly underscores the need for financial guidance, it's not too late for students to get things back on track."

McVey recommends students start applying straightforward steps and tools to help improve their spending and savings habits. McVey points to BMO SmartSteps for Students, a program designed to provide useful ideas to help students stay on top of their money, as well as other online tools, such as the Student Budget Calculator.

"Students and parents can also work with a financial advisor to seek out the proper tools and services that can help save cash wherever possible," adds McVey. "For example, developing and monitoring a realistic budget, minimizing banking fees by opening a no-fee student account and taking advantage of student discounts with a SPC card can make a big difference in curbing expenses on a monthly basis."

Additional findings include:

  • Female students are more likely than male students to know what their expenses are and how much they can spend (48 per cent vs. 39 per cent). 
  • 47 per cent say they did not discuss their finances with anyone before making their decision to attend college/university
  • Students in Atlantic Canada were the most likely to discuss finances ahead of time (73 per cent), while those in Quebec were the least likely (29 per cent) 
  • 23 per cent were surprised by the cost of textbooks
  • Only 12 per cent of students are financing their post secondary education completely on their own, with no aid
  • Of those with a budget, 51 per cent of students track their spending by checking their accounts online regularly
  • Students in Quebec were the least likely to have prepared a budget that included major expenses (27 per cent), while those in BC were more likely (35 per cent)

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