CALGARY, June 15, 2015 /CNW/ - It's official, spring convocation is over and you're a post secondary graduate. Congratulations! For many new grads, the job hunt is on and it's time to start thinking about paying back the money you borrowed and get out of debt. Where do you start? With only a 6 month buffer until you need to start paying off Canadian student loans, you need a plan and a job. Let's take a look at the best course of action for two recent grads, one without a job and one with a job.
Scenario 1: Unemployed New Grad
Finding a job in your industry isn't exactly a piece of cake. You've been looking, but to no avail. Your personal debt and the upcoming student loans will be a burden if you don't find a job soon. What should you do?
Step 1: Find a "meantime" Job
Find a job that allows you to pay for basic needs and living expenses. This will prevent you from accumulating more debt while you're looking for a job in your field. If necessary, take on a part time job too. With any luck, you'll be able to start paying off some of the money you owe.
Step 2: Take a Good Look at Your Finances
Create a budget along with a timeline to pay off student loans and personal debt based on your current income. If you are struggling to live within your budget, take a look at Money Mentors' resources for money management including free financial calculators, budget tips and saving strategies.
Step 3: Be Patient
Finding a job in your industry can be a challenge, especially when you need a job right away. Start attending free industry events and keep applying for jobs. If you need more guidance or help paying down debt, find a credit counselling agency that can help.
Scenario 2: Employed Post Secondary Grad
You lined up a job before graduating, but have no idea how to budget and get out of debt. Sure, you're making some money now, but how can you be sure you aren't overspending? How can you pay off debt and save for the future?
Step 1: Assess your Financial Situation
What is your monthly income? How much money do you owe for your post secondary schooling? Do you have Canadian Student Loans? What are your monthly expenses? Based on these financials you can build a budget that will give you a realistic amount to put aside each month. Use these handy budgeting tips to help you start saving.
Step 2: Start Saving
If you haven't already, consider opening one or both of these two savings accounts: RRSP or TFSA. Many companies will automatically deposit a portion of your pay cheque into your RRSP account for you if you request it. Not only do they set it up for you, in some cases, companies match the amount you have put in after one year's time. As for the tax free savings account (TFSA), they are beneficial for just that – being tax free.
Step 3: Set Financial Goals
Now that you feel like you have a handle on how to save, consider setting financial goals that will set you up for success. The best way to do this is by using a SMART goal (Specific, Measurable, Attainable, Realistic, and Time Frame).
These two scenarios might not cover your job and financial situation exactly after graduating, but they both provide alternatives to hoping for student loan forgiveness. If you find yourself struggling to make payments or going further and further into debt, we are here to help. Call us at 1-888-294-0076 or visit our website: www.moneymentors.ca
Money Mentors is the only Alberta-based, not-for-profit credit counselling agency. Through a number of services, we help families and individuals recover from financial crisis and move forward. From credit counselling and money coaching to retirement planning and community financial literacy, we are contributing to a healthier financial future for the entire province.
SOURCE Money Mentors
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For further information: or interviews, contact: William Akoto, MoneyMentors.ca, Toll-free: 1-888-294-0076, [email protected], Facebook.com/MoneyMentors, Twitter.com/MoneyMentors