Financial Planning
Understanding how to manage your finances is the first step to making smart choices with your money. It’s about learning the basics and making informed decisions for your future. Let’s explore financial planning together!
Your Financial Words Glossary
When learning about finances, you might come across words you haven’t heard before. Some words you will see on this page are:
Bursary
Money that helps you pay for school that you don’t have to pay back. Bursaries are usually given to students who need extra financial help to cover school costs and are usually provided by the school or the government.
Grant
Money given to help you pay for school that doesn’t have to be paid back. Grants are usually given to students who need help paying for school and are often provided by governments or other funders.
Scholarship
Money that helps you pay for school that you don’t have to pay back. Scholarships are usually given to students who do well in school or have special talents.
Budget
A plan for how to spend and save your money.
Credit
Borrowing money with the promise to pay it back later.
Credit Score
A number that shows how reliable you are at paying back money.
Interest
The extra money you pay when you borrow money or get paid when you save money.
Loan
Money you borrow and must pay back with interest.
HOW DO I…Make a Budget?
Credit Cards and Loans
You can get credit in different ways, like credit cards and loans. When you use credit, you’re borrowing money to pay for things now and agreeing to pay the lender back.
A lender is someone who lets you borrow money from them, like the government, banks, or other loan companies. Credit cards and loans both charge interest, so it’s important to only buy what you can afford to pay back. If you spend too much and can’t pay it back on time, you can get into debt and owe a lot of money.
Credit Cards
Credit cards let you borrow money from the bank to buy things. They are handy because you don’t need to carry cash. When you use a credit card, you have to pay back the money you spent by the end of the month. If you pay the full amount, you won’t have to pay interest.
Payday Loans
A payday loan is a small, short-term loan that you have to pay back quickly, usually by your next paycheque. These loans are easy to get but have very high fees and interest rates. If you don’t pay it back on time, it can be very hard to pay back.
Student Loans
You can get student loans from the government to help pay for college or university. They can help with costs like tuition, books, and living expenses. You have to pay them back after you finish school, usually with added interest.
Bank Loans
Bank loans are good for big expenses like buying a car, getting a home, or starting a business. Before giving you a loan, the bank will ask for proof you can pay it back. This means you will need to show them you have a job or other income. You will have to make regular payments until the loan is fully paid off. They will charge less interest if you have a good credit score.
Credit Score
Your credit score is a number that tells lenders how good you are at paying back money. This number is updated by companies called credit agencies whenever you borrow money and pay it back. The higher your score, the easier it is to get credit. Here are some tips to help you get a good credit score:
Pay Your Bills on Time
Always pay off your loans and bills by the due date. Late payments can lower your credit score.
Use Credit Wisely
Only use a small part of the credit you have. For example, if you have a credit card with a $1,000 limit, try to keep your balance under $400. Using too much of your available credit can hurt your score.
Don’t Apply for Too Much Credit
Applying for too many credit cards or loans in a short time can make your credit score drop. Only apply for credit when you really need it.
Keep Old Credit Cards Open
If you have old credit cards that you don’t use, keep them open unless there’s a good reason to close them (like identity theft). The longer you have credit, the better it is for your score.
Check Your Credit Report
Look at your credit report at least once a year to make sure everything is correct. You can get a free copy from credit agencies like Equifax and TransUnion. If you see mistakes, report them right away to get them fixed.
Finding Help for School
Many organizations offer money to help Indigenous students pay for school. This money can come as loans or as grants and bursaries. Grants and bursaries are given to students who need extra help paying for school, and you don’t need to pay them back.
Search for Funding
Use websites like Google and Canada Student Loans and Grants to find loans, grants, and bursaries. Indigenous Services Canada also has a list of bursaries specifically for Indigenous students.
Apply for Grants
Once you know which grants you’re interested in, you will need to apply. You can find out how to apply on the grant websites. Many funders also have information sessions that will walk you through the steps.
Ask for Help
If you get stuck, there are people and services who can help. Reach out to librarians, school counsellors, student services, and employment services. You can also ask grant funders for help directly.
Understanding your finances is the first step toward building a secure future that you’ll feel confident about. Remember, the financial decisions you make are yours alone, and that’s what makes your journey to financial security special!
