Teaching our kids and teens about money is important because the more money they earn and save, the less money us parents have to give them!
I have spent many years teaching teens about money as a high school business teacher. Luckily for me, it’s a topic I love to teach! I find it to be educational, engaging and really fun. It can also be connected to many real-world experiences so teens never have to ask, am I ever going to have to know about this? or when am I ever going to use this? Answers: yes and pretty much every day.
I’ve covered budgeting using different strategies depending on the ages of my students. We’ve created budgeting spreadsheets from scratch and even discussed the use of money jars that Gail Vaz Oxlade sometimes uses in episodes of “Til Debt Do Us Part. I’ve also checked out a number of different online budget calculators, some simple and helpful, others confusing and not so helpful.
So for today’s blog post, I’m focusing on sharing one of my favourite online Student Budget Calculators for teens who are planning for post-secondary.
It is RBC’s Student Budget Calculator. (Note, I don’t bank with RBC but it’s still one of my favourites.) It has a simple to user interface, provides a good summary and covers the key elements well.
If you have a teen in high school, give this a try together!
Student Budget Calculator to Plan for Post-Secondary
Throughout this article, I’m using the scenario of a student entering a Nursing program at Western University (in London, Ontario) and living on campus, in a traditional residence, with a meal plan.
RBC Student Budget Calculator Overview
The RBC Student Budget Calculator has 4 steps:
Step #1 – School Details
Step #2 – Expenses
Step #3 – Income
Step #4 – Results
Step 1 of 4 – School Details
As you can see below, there are a few basic questions to answer to get started.
Where will you be going to school? (select Province)
What type of school? (select University, College or Vocational School)
What area of study? (select from list)
Where will you live while attending school? (select At Home, On Campus or Off Campus)
Will you be studying full-time or part-time? (select Full-Time or Part-Time)
How many months will you be in school this year? (select number)
Then click Continue.
Step 2 of 4 – Expenses
This step takes a bit more time because each student’s situation is different. However, RBC has included some default amounts to help you get started based on “national averages from Statistics Canada.”
SCHOOL FEES
School Fees include:
School Tuition
Books
Supplies
Other Fees
School Tuition
For assistance with Ontario university fees, check out this link from Ontario Universities Info that provides you with tuition and additional fees for Ontario students for different programs at each university.
www.ontariouniversitiesinfo.ca is a one stop shop for students for all things related to Ontario universities.
Here’s a screenshot of the Tuition and Fees page:
Similarly, the Ontario Colleges site also has information on tuition and fees for students headed to college in Ontario. You can see that the average cost of tuition for a full-time student in a Diploma program is $2,400.
For this example, tuition for Western Nursing is $6,050 and Ancillary Fees are $1,467.70 for a total of $7,517.70.
Note that Ontario university tuition can vary significantly depending on the program but according to Statistics Canada, the average tuition in Ontario ranged from $6,080 to $6,814 in 2019/2020.
Books
Textbooks are another large expense for post-secondary education. The cost will vary depending on the program but some general figures are:
Ontario College Diploma Program Average
$1,300 (for books and supplies) according to the Ontario Colleges site.
Ontario University Degree Average
$773 according to McLean’s Magazine in The Cost of a Canadian University Education in Six Charts. However, I think this is too low.
Wilfrid Laurier University has a helpful overall summary of “Estimated First Year Expenses” and it lists $1,000 for textbooks which I find much more realistic than the $773 figure.
Supplies
The supplies a student will need will vary depending on the program but it essentially covers equipment and items such as technology, printer cartridges, art supplies, etc. that are needed for various programs. Although tuition is the biggy, these expenses can add up so it’s best to include them in the budget.
Other Fees
Colleges and universities have other fees that may be incurred such as an athletic and recreation fee, student fee, health and counselling fee, etc. These are often shown in a general category such as “Student Fees” or “Ancillary Fees”.
HOUSING/LIVING
Housing/Living expenses include:
Housing/Rent
Food/Groceries
Utilities
Mobile Phone
Other
*Note that you are to enter these as monthly expense amounts.
I’ve used the Western University Residence Fees and Payment site to get expense figures for a traditional residence and meal plan. Utilities are not applicable for a student living in residence and Mobile Phone and Other expenses are estimated.
TRANSPORTATION
In my scenario, this student doesn’t have a car but would like to buy a monthly bus pass.
TRAVEL
For this section, I’ll assume the student will make 2 trips home each semester. This cost will of course vary depending on where the student lives, where they go to school and how they are travelling to and from home. Private jet $$$$$? Bus $$? Mom or dad $?
Vacations? Nope.
LIFESTYLE
Lifestyle expenses include:
TV/Cable/Satellite
Internet
Shopping/Clothes
Entertainment
Health/Gym Memberships
Personal/Other
In this scenario, TV/Cable/Satellite and Internet will be provided by the residence. Other amounts vary depending on the lifestyle of the student.
Summary of Part 2 – Expenses
STEP 3 of 4 – Income
Now that we’ve all gotten over the shock of Step 2 (note: this result is higher than the typical average that I have seen – approx. $25,000 yearly), Step 3 is a great way to identify any financial gap between income and expenses.
Income includes:
Savings/Investments
Financial Assistance
Income
Savings/Investments
In this case, we’ll assume the student has saved $3,600 for post-secondary and that the parent/guardian has $5,000 in an RESP.
As an fyi, for Ontario students, OSAP (Ontario Student Assistance Program) generally expects students to have $3,600 of their own savings to put toward their education each year.
Financial Assistance
Financial Assistance includes:
Government Loans (e.g. OSAP)
Scholarships/Bursaries/Grants
Other
OSAP has an “Aid Estimator” that you can use to get an estimate as to the loan/grant a student may receive. This may be helpful for this step. OSAP Aid will vary substantially based on each student’s situation, but for this scenario, I am using a total OSAP amount received of $8,000.
Scholarships/Bursaries/Grants are largely unknown until the end of high school so although there are many such opportunities available, for this scenario I will set this to 0.
Income (Monthly)
Monthly income includes:
Part-Time Job
Family Contribution
We’ll assume this student has a part-time job while attending school and works 12-15 hours per week. I have set the family contribution to 0 as this will vary depending on familial circumstances.
Summary of Step 3 of 4 Income
Step 4 of 4 – Results
Here are the final results of our scenario:
What I like about RBC’s Student Budget Calculator is that the results are clear and easy to understand.
Next Steps
Rather than get discouraged by this shortfall, it can be an opportunity to go back and look for ways to reduce expenses and/or to increase income.
It can also help motivate teens to save more of their earnings as soon as they start to work because they have seen concrete numbers.
Most importantly, looking at this in advance helps everyone to plan better and to plan ahead.
The length of this article and all of these screenshots might make this calculator seem more complex than it is. However, it has a simple interface, RBC makes it really easy to pop in your numbers, and there’s no confusion about the results.
Although you have the option of printing off a nice summary, the drawback of this calculator is that once you have finished, you can’t save, go back and play around with different values in the scenario. I think RBC should change this part… 🙂
Everyone has their own ideas about how to plan for post-secondary with teenagers but it is nice to have a few simple tools to get you started. I hope you find this one helpful!
Cheers to our hard-working teens!
References
Common Universities Data Ontario – Western University – First Year Domestic Tuition and Ancillary Fees by Program
Statistics Canada – Average undergraduate tuition fees for Canadian full-time students for Canadian full-time students by province and selected field of study, 2019/2020
McLean’s Magazine – The Cost of a Canadian University Education in Six Charts
Wilfrid Laurier University – Estimated First Year Expenses
Western University – Residence Fees and Payment
OSAP (Ontario Student Assistance Program)