I've learned many things about finances and money as an accounting student. Here are my three most important tips for managing money.
Know where your money goes
More often than not we are unaware of where we spend our money. We’re confused about where it goes and why we aren’t closer to meeting our savings goals. One way to see where it all goes is to write down or track all of your spending for a month. November is Financial Literacy Month, What a great month to start. Write down what comes in from salary or benefits and what you spend it on. This will help you spend on the things that are most important to you.
Learn about credit cards
Understanding the different terms used in the world of banking can be confusing and overwhelming. One of the areas where misunderstanding happens most is with credit cards. Often people do not understand their credit card contract. They can end up owing major balances in interest and penalties.
Many people believe they only have to make what the banks call a “minimum payment”. They think they can carry monthly balances without any interest or penalty charges. This common misconception will cost you a lot of money. Banks charge you interest on every purchase included in that monthly balance.
Credit card companies make money when you go over your limit and when you get cash advances. Try to pay off credit card balances in full each month. Use an ATM (automated teller machine) or debit card when you need to get cash.
File your taxes
Don’t forget or dismiss the importance of filing and paying your income taxes on time. Failing to file your taxes on time could result in high penalties and interest charges whether you are an individual or a small business owner. Personal income taxes are due April 30 each year. If you are self-employed you have until June 15 to file, though any amount you owe is still due by April 30. File and pay your income taxes on time to avoid paying your hard-earned money on interest and penalties. You will also benefit from potential refunds and credits, such as the new Canada Child Benefit and GST credit.
- Natalie Kellar
Natalie is a student in the Chartered Public Accounting program and works at Avery Cooper & Co. Ltd. in Yellowknife.
