Most students say they are financially unstable, unable to afford the basics
A college education can open the doors to a career with greater prospects and compensation, good news for long term prosperity. But that’s assuming students can manage their finances in the near term.
Although much is said of the impact of student debt for many years following post-secondary education, a new report from TD highlights the very real struggles of students as they begin and continue their education.
Two thirds of respondents define themselves as ‘financially unstable’ and for almost half this includes being unable to afford basic everyday needs such as food and housing. Even though the majority have a budget to help them track monthly expenses, only 41% say they can follow it on a regular basis.
This means that thousands of young Canadians are starting adulthood with a negative view of their financial management with 37% saying they regularly compare their finances to that of others and 28% feel inadequate around those who appear to be better off.
The survey reveals desire for greater financial education including 61% of participants who would like to know more about budgeting and 46% who want to gain knowledge about savings and investment vehicles such as RRSPs and GICs.
"Our survey shows that many Canadian post-secondary students wish they knew more about budgeting and managing their finances, and it's encouraging to see them interested in seeking advice," said Emily Ross, VP, Everyday Advice Journey at TD. "That said, it's prudent for students to exercise some caution when taking financial advice from certain sources on social media platforms, which are often unvetted and untailored to each individual and their unique circumstances."
Mom and dad
The ‘bank of mom and dad’ plays a significant role in the finances of Canada’s students, with 94% of parents of post-secondary students saying they provide some level of financial support for their child, 58% report doing so at a significant level.
Parents also have a view on areas of financial knowledge that their offspring could improve:
- Budgeting (87%)
- Developing better spending habits (60%)
- Better financial literacy (42%)
- Less reliance on their parents for financial support (37%)
- Using financial apps to track their budget (27%)
A survey from earlier this year found that parents are willing to risk their own finances to send their kids to college.
