As we approach the summer months, a number of companies and organizations make positions open to give students the opportunity to gain work experience in selected fields of interest. By having this opportunity, students can use this time to earn money rather going to summer school or socializing with friends on a daily basis.
Although working during the summer gives students the ability to generate additional spending cash, the generated income should be geared towards savings. To do so, students should consider the following six tips before, during and after summer employment.
1. Select The Right Job
It is important that you select the right job based on your needs. Your criteria for selecting the appropriate summer job may vary from the amount of money you can earn to the distance that you have to travel to get to work. As a result, you have to decide what is best for you however; you should not take a lot of time to make a final decision. Taking your time may result in another individual applying and getting the job. Ultimately, you should choose a job that you will enjoy and provide you with valuable work experience for the future.
2. Set Your Goals
While summer job hunting, you should have an idea of how much you wish to save from your months of employment. For some students, generating enough money to purchase books may require working 25 to 30 hours can be goal to obtain by tutoring or working in an office performing administrative tasks. In addition, having a saving goal will motive you to fulfill your responsibility to arrive at work on time.
3. Split Your Pay
Knowing the amount of money that you wish to save from your summer job will give you the ability to split your pay. Although you wish generate additional income, you still have to account for expenses and a social life. As a result, you may want to split your pay using percentages. For example, consider splitting 60% / 30% / 10%, where 60% of your pay goes to your savings account, 30% goes to expenses and 10% goes to your pocket. In order to reach your saving goal, it is important to be discipline and follow your plan in the short and long term. This would entail living within a feasible budget that should be established once hired for the summer.
4. Automate Your Savings
To assist you in reaching your goal, you can automate your savings. Automating savings allows you to transfer cash from a chequing account (where your pay is deposited) to a saving account on a regular basis. For example, if a student using a pay splitting plan of 60% / 30% / 10% where $500 is earned every two weeks, the student will select to have $300 ($500 X .60) transferred automatically in a savings account bi-monthly. Depending on what the money is going to be used for, you may want to invest the amount in various savings accounts. (Please speak to a financial advisor for more information on the savings accounts). Once again, it is important to be discipline and avoid touching the money that is in the account until you are ready to spending for the intended use.
5. Avoid Bank Fees
With the additional money that will be going into your bank account(s), you have to see if you will be incurring any additional bank fees. Bank fees will slowly eat away at your savings on a monthly basis. If your existing bank will not lower your bank fees, consider switching or opening a savings account at another bank that does not charge any fees.
6. Avoid Extra Expenses
Although you may be making additional income, be aware that you are not incurring any extra expenses. Extra expenses such as travel, fast-food lunches and new clothing will take a good chunk of cash from your ability to save from summer employment. To avoid these expenses, consider taking a bike to work, make lunch at home and invest in clothing that you could wear for other formal or casual occasions.
Taking on a summer job provide students two main advantages: the ability to gain work experience and earn income. To better manage money earned from summer employment, students must be prepared to have and execute a plan that will enable them to save money for the future.