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Summer is just starting for most kids, but for college and university students it’s already halfway over. If you have a child who is off school and working for the summer, now’s a good time to see how their bank account looks.

A student’s summer earnings can cover a good chunk of the bills during the school year, and with a bit of planning that money can be a game-changer. A quick look at four Ontario universities – the University of Western Ontario, the University of Waterloo, McMaster University and the University of Windsor – showed that tuition, residence or rent, food, activity fees and books add up to between $23,000 and $30,000 a year for a student living away from home. Costs could be much lower if they live at home – around $10,000 less a year – but no matter what, education is a big expense.

If a student works full-time over a four-month summer – May to August – and earns $16 an hour, they can make somewhere north of $10,000. If they spend some of it during the summer, let’s say $100 a week, they might have around $8,500 left by Labour Day.

The key is to maximize this hard-earned money. There are three things parents can do to help their kids do that: make it motivating to save, set up a savings plan and establish a budget for the school year.

Anyone who is saving money needs motivation. Our present selves need to envision the benefits for our future selves. For university-aged kids who might be earning more money than they ever have before – and have lots of ways to spend it – this is especially important.

A student’s summer earnings can feel “lost” in the large pool of money earmarked for their education, so show them how their earnings make a real difference. One eight-hour work day can be a week’s worth of groceries. An evening shift can pay for a week’s worth of lunches.

Saving for a specific purpose rather than just adding money to a big bucket is also motivating. Sit down together and make a list of the education-related costs, then pick the ones your student will pay for. For example, they could pay for all of their groceries and spending money. These are tangible and measurable savings goals, which are helpful to have when planning.

Parents can also help with the logistics of saving. The student should have two accounts: one for spending and one for savings. Get them in the habit of transferring money to the savings account every paycheque – the classic “pay yourself first” strategy.

Students who know they’d be tempted to spend money during the summer might want their parents to tuck the money away for them. If that’s your kid, set up a separate savings account for that purpose and keep a running tally on a piece of paper taped to the fridge, which will show them the progress they are making.

Making student money last from September to April requires some planning. Before the school year starts, help them put together a budget for their spending. Make the best estimate possible for how much they will need to spend on groceries and set a budget for their discretionary spending.

Each month they can pay themselves an income from their savings account or if they prefer, you can do it for them. They will be responsible for making sure the money lasts until their next “paycheque.” If you’ve underestimated the costs, you can always adjust the budget once you get into the school year.

With students facing soaring costs, any summer earnings will help ease the financial burden during the school year. And learning money management skills will help set them up for a lifetime of success.


Anita Bruinsma is a Toronto-based financial coach and a parent of two teenage boys. You can find her at Clarity Personal Finance.

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