Financial Q & A with RBC On Campus
Looking at how students can support themselves financially in today’s climate
Organized by Sarah McPherson, in conjunction with Thunder Bay campus’ RBC On Campus team
Note from Jamie De Sousa, Branch Manager:
On behalf of Nimarta, Alex, and all of my RBC colleagues, we are truly honoured to be part of the Lakehead University family. When we first joined this community last November, we saw firsthand what we already knew from many years of partnering through initiatives such as the RBC Work-Integrated Learning Program: that this is a very special place to be.
We see ourselves as being on the university journey alongside the students of Lakehead. This not only means being there for students to support and guide them with their financial goals and decisions, but to also support their future career aspirations through RBC Future Launch.
You can currently find us in the Lakehead University Agora next to our friends at Starbucks. We are available Monday to Friday, 8:30 am to 4:30 pm. While we are enjoying our current pop-up location, we also look forward to moving into our permanent location in the open space outside the main cafeteria in the near future.
How can a student save for a home during this financially limiting period?
The right time for purchasing a home can mean different things to different people. Much like any life goal, such as pursuing a post-secondary education, it requires a clear dream, thoughtful planning, and an unwavering commitment.
The Dream
Your journey begins with meeting with a certified financial advisor to share your goals and learn how to achieve them. Every great dream begins with a clear vision of that dream and the journey to reach it. You don’t need to be ready to buy a house today to seek advice on home ownership. Make an appointment to find a tailored plan made for you.
Planning for the Future:
Having a budget is key to achieving any financial goal. A budget should also be flexible and realistic. Don’t only focus your budget on saving for tomorrow. Build in room for those things that nourish you today. If we make our budget too strict, it will be difficult to stay with that budget over the long term. Make it achievable. When setting money aside, every bit helps – if anyone thinks $20 a week doesn’t matter also thinks $1040 at the end of the year doesn’t matter either. Set aside what you can and take pride in that every dollar is a step towards the dream.
An Unwavering Commitment:
Make it easy to stay focused on your budget with digital solutions at your fingertips. Set up automatic transfers into savings accounts or investments as the money enters your account to make it easier not to spend it. Use Mobile Banking or Online Banking to track your expenses.
NOMI, only available in the RBC Mobile app and available through iTunes or Google Play, is a digital tool at your fingertips that takes planning and delivering on that plan to a whole new level. NOMI Insights analyzes your monthly cash flow, categorizes your spending, and more, to show you exactly what your money is up to and what it's going to do next. NOMI Find & Save will help do the work for you by finding those extra dollars you won’t miss and putting them aside for you. NOMI Budgets provide a calculated budget recommendation based on your unique spending habits and then helps keep you stay on track with updates and reminders.
Regardless of your current financial situation, paint the picture for the future by meeting with a certified financial advisor, create a plan that empowers you to take a new step towards your dream every month, and access the tools and advice that will help you stay focused on your goal.
Should students be actively investing their money?
Each person’s financial situation and goals are different and not all investment solutions are the same. It’s important that students sit down with a certified financial advisor to build a plan with solutions tailored to their own needs. This includes finding the right amount for the right investment solution for the right person.
What is the best kind of credit card to get for your first time?
A credit card is an important financial solution for you both today and for the future. In addition to being a convenient and secure way to shop, credit cards help you build your credit rating, provide you with Purchase Security and Extended Warranty Insurance (with many cards providing additional insurances), and, depending on your card, provide cardholders the opportunity to earn points and redeem them for rewards.
Finding the right student credit card depends on what is important to you in a card. For example, is it access to general rewards, cash rewards, travel rewards, having low or no fees or a combination of more than one? We at RBC recognize that this is an important decision that requires you to ask yourself key questions. That is why we provide the Credit Card Selector Tool for students as well as personal clients and business clients. As well, the RBC Card Comparison tool enables you to see the features of up to three cards at once to help you make the right decision for you.
Equally important to having access to the right credit card is knowing how to manage it and the difference this can make to your financial health. From how you choose to pay it down each month to how you protect your card, know your responsibilities and (something you all know a great deal about) do your homework to ensure you’re using the right card the right way.
How big of a line of credit should you take out?
The right line of credit limit depends on the financial situation and needs of the individual. Much like all other financial solutions, each person’s needs are different and so it is important to find a tailored solution for you. By spending time with a certified financial advisor, you will feel informed on how to build a plan that reflects your needs.
When deciding on the right limit, in addition to considering what you need, ensure you have considered having access to funds in the event of an unanticipated emergency.
Also, when looking at managing debt, it’s important to look at your total debt picture to ensure you are managing your debt at the lowest possible cost. That means moving and carrying debt within the credit solution with the lowest interest rate. As well, much like credit cards, opening and using a credit line and making your payments on time can help you establish a positive credit history.
How do TFSA accounts work, and should students look at opening one?
Tax-Free Savings Accounts, a registered account, are a great way to save your money because they are designed to help you save money tax-free. You can save anywhere from $100 to $6000 in a TFSA in one year, and whether you earn interest, dividends or capital gains, your money will not be taxed, even if you withdraw it. And because you can withdraw funds whenever you need to, TFSAs offer great flexibility for saving for short- or long-term goals.
Before you start using a TFSA, it’s important to be aware of the benefits and what else you need to know before choosing to contribute.
Check out the TFSA calculator that helps identify your annual limits.
When should students start looking at a retirement fund?
It is never too early to begin preparing for the future. In fact, there are many benefits to starting early. Each student’s financial picture is unique and so it is important that students make an appointment with a certified financial advisor to create a plan reflective of their current situation, their future goals, and the benefit of starting a plan today.
What are your top tips for helping students set themselves up for success after they finish their degree?
Graduation may mean different things to different people. For some it may mean an opportunity to begin a career in their chosen profession. For others it may mean travel abroad. For some it may mean pursuing further education. And still for others it may mean paying down debt. Whatever your post-graduation plan may be, plan for what you can today with the right savings and debt management plan to help you prepare for tomorrow.
Consider these three tips to help you prepare for tomorrow:
Financial Literacy is key to helping you pursue and achieve life’s dreams – educate yourself on the products and services available to you and through programs such as the McGill Personal Finance Essentials free online course in collaboration with RBC Future Launch and The Globe and Mail.
The financial decisions you make today can help or hinder you in the future – enjoy today but position yourself for success for tomorrow. Develop strong savings behaviours and debt management practices. These will serve you well today, tomorrow, and even further down the road.
Create a tailored plan just for you with a certified financial advisor and revisit your plan often (at least annually) and as your financial picture, needs, and goals change.
As your education here at Lakehead University has already taught you, simply dream, plan, and commit.
