Learning to navigate finances as a university student

Breaking the money taboo helps students learn financial literacy

Learning about financial literacy helps students manage their finances during and beyond university.

One of the most off-limits topics in our culture is money. The ‘money taboo’ keeps children from learning about financial literacy as they grow up. As a result, young adults often feel confused and overwhelmed when they have to navigate their own finances in university.

“Growing up, I was taught nothing about financial literacy,” Maya Haynes-Pool, ConEd ’22, said in an interview with The Journal

Before beginning her first year of university, Haynes-Poole got her first credit card to be used only in emergencies.

“For the first year of my degree, I was going to go to the BISC [Bader International Study Centre] in the UK, and in order to do that, I had to take out a separate student line of credit,” she said.

“I remember going to the bank with my mom and having a financial advisor. Originally, I didn't even know I was getting a credit card. I went there for a student line of credit [...] They were like, ‘because you're a student, you should probably have one of these.’”

For countless students, the first line of credit they receive is a student credit card. At 18 years old, banks, department stores, and other financial organizations advertise to young university students to sign off on their very own card. 

With low credit limits and relatively low-interest rates, these are considered beginner cards, perfect for teenagers who are just starting to build their credit score. 

These cards are handed out without the same caution that often comes with an older adult’s line of credit. An unemployed adult may have a difficult time getting approved for a credit card, but any 18-year-old student is almost guaranteed to get approved.

When students receive their first credit card, most often, they aren’t well-educated about the responsibilities that come with having it and the consequences of not paying off your credit card bill each month.

Furthermore, many young adults are told to use their credit cards in emergencies rather than having an emergency fund. However, as Haynes-Pool experienced, these emergency expenses can often set students on a downward spiral of accumulating credit card debt.

“Six weeks into my stay at the castle in the UK, I got a really bad concussion. I had to come home, so that put some money on [my credit card] to adjust,” she said. “Then I decided to get Invisalign to fix the gap in my teeth and I put that on to the credit card, and then it spiraled from there.”

Seeing the increasing balance on a credit card can often make students feel overwhelmed. When they don’t have anyone to talk to, they can feel helpless trying to get the balance back to zero.

“It seemed like I could never get it back down to zero. I was like, ‘there's going to be a balance on it anyway, so I might as well order food or do this online shopping because I'm already in debt so it's not going to make that big of a difference.”

As the debt began to accumulate, Haynes-Poole didn’t know how to begin paying it off.

“I didn't make a massive dent into my credit card debt until earlier this year, when I was on TikTok,” she said. “I've never seen people talk about finance in this way where it's so accessible.”

Haynes-Poole found that setting small goals and breaking it down into small chunks helped her start paying back her debt.

“[The TikTok video] broke it down like ‘these are the steps to get your money in order and this is what you need to do.’”

Talking about her finances and seeing that other people were in similar situations helped Haynes-Poole realize that her problem was surmountable. Seeing how other people paid off their debt helped her calm down and create a plan.

“[The TikToker] has a Facebook group community which I joined and being a part of that helped me to sit down with my money and not have a panic attack over it because I was like, ‘this is okay, there is going to be a plan in place where this will get better.’”

Haynes-Poole has recently paid off all her debt by using tips from TikTok, podcasts, and blogs.

“It's a massive, massive weight off my shoulders,” she said. “Before it was keeping me up at night like ‘I don't know how I’m going to pay rent next month.’”

“For the first time in my life I have a savings account with actual money—an emergency fund. If anything is to go wrong [...] I don't have to go into debt to handle that. I have money set aside, so I don't put myself in that position again.”

Now that she’s paid off her credit card debt, Haynes-Poole has new systems in place to help manage her money. 

“I never thought I'd be the spreadsheet person but I'm a spreadsheet person,” she said. “Watching to see where my money is actually going is definitely a big help.”

Watching her money also helped her become more aware of her spending habits and identify areas where she can cut back on spending.

“Maybe I don't need to be spending $70 a month at The Works Cafe,” she said. “Maybe I should just start bringing the food that I have at home.”

In a culture where we are taught to keep our finances private, it can feel embarrassing or shameful to reach out for help. Meanwhile, trying to fix things alone is isolating.

“If anyone is in a stressful financial situation, it's nothing to be embarrassed about,” Haynes-Poole said.

“That's such a big reason why I was in that situation for so long. I didn’t talk to anyone about it because I didn’t want anyone to see how bad it was and I was overwhelmed by it. There are resources out there and you don't have to learn everything in one day.”

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“Don’t be seduced by some of your friends who seem to have unlimited means,” Susan Hall, ArtSci ’85, said in an interview with The Journal.

Hall has a master’s degree in finance from Boston University, is a CFA charter holder, volunteers in the space of financial literacy education for high school students, and is a mom of two university students.

“Don’t let that be your guide point. Look at your own situation, be honest with yourself.”

We don’t talk about money. When you see those around you spending, it's impossible to know whether they can truly afford what they have or if they’re drowning in credit card debt. For this reason, the most important thing is to focus on yourself.

“Do not look at other people and what they can throw their credit card down for. Do not covet that,” Hall said. “One day that will be gone for that person as well. You never know what will happen. Look out for number one.”

As a mom of two children who have gone through university at Queen’s, Hall was struck by the lack of financial literacy education.

“There are too many students with too little financial supervision and zero financial literacy,” she said.

In June 2020, the Ontario government announced a new math curriculum that heavily features financial literacy as a key section from the first grade. Starting in the 2020-21 school year, Ontario students will spend nearly a fifth of their math lessons learning about budgeting, wants-vs-needs, and healthy levels of debt.

Prior to these changes, financial literacy was not a highlighted part of the Ontario curriculum. Today’s university students are unlikely to have a formal financial education. 

Hall believes that university students should receive more education about creating a budget and learning to stick to it. Her advice for university students is to “take control, get educated, create a budget, live within it, and if emergencies come up, tell your parents.”

Students are often reluctant to talk to their parents about money issues for fear of looking irresponsible. However, as a parent, Hall talks about the importance of talking about money issues with your parents before it becomes an emergency.

“Do not send up the flare when they’re about to turn off the power in your house,” she said. “Early warning system is good.”

Being proactive with finances helps students stay out of debt and allows them to steadily build their wealth.  For students with no financial literacy who are looking for extra money or are in desperate need, get-rich-quick schemes can seem like an easy solution.

“If it was that easy, we’d do it ourselves,” Hall said. “There’s no easy way to get rich. Anyone that tells you it’s Bitcoin or some kind of crypto, they’re all liars. Don’t read that crap on the internet. I know a lot of students do.”

Although everyone wants to accumulate wealth, a more realistic goal for most is to live a life where money is not a worry, and debt is not a burden.

“What we can aspire to is happiness, and hopefully freedom from financial insecurity,” she said. “I’m incredibly amazed at how much people worry about money.”

When discussing money, it is also important to remember that it isn’t the only marker of success.

“It’s not about finding the job that pays the most money. I was in a job making almost a million bucks a year and I was miserable,” Hall said.

***

“If one has low financial literacy and is struggling to handle their finances, this will likely create stress or worry, which will impact their mental health, which has implications for their physical and social health,” Erin Burns, Peer Health Outreach Coordinator at Student Wellness Services, wrote in an email to The Journal.

This year, the Student Wellness Services Peer Health Educator Program launched their first-ever financial literacy team.

According to the World Bank, 68 per cent of Canadians are adequately financially literate, though most of Canada’s financial experts don’t agree. With a lack of education and little resources, students are highly vulnerable to accumulating debt and falling prey to scammers. 

The financial literacy team hopes to create a safe space where students can openly talk about finances and address any questions or concerns.

“We are excited to dismantle [the money] taboo and help people reach their financial potential,” Shae Wessler, member of the peer health educator financial literacy team, wrote in an email to The Journal.

“The taboo keeps us ignorant of best habits, practices and perspectives.”

In a focus group run by the financial literacy team, many students inquired about bank accounts, how to manage money after graduation, how to begin investing as a student, paying off debt, and renting and buying houses.

Although these are extremely common questions for young adults, they are topics scarcely discussed. 

“​​Talking about money with others can help you grow in financial knowledge and freedom,” Wessler said. “People must be able to have these hard discussions as they are what allow for growth.”

The financial literacy team currently runs two events,” Living a Financially Healthy Life, which teaches students about budgeting and saving and Borrowing for the Books, a workshop about paying off student debts and managing a credit card.

Next year, they plan to release a podcast discussing financial aid, budgeting, and saving money.

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