How to budget in university: A student’s guide to managing money

If there is one course that should be made a requirement in university, it’s budgeting. Learning how to manage debt effectively and deal with unexpected financial surprises can help set you up for lifelong financial success.

Once you start to see how your spending lines up with your priorities, it becomes easier to cover the basics, while still leaving room for the things that make life enjoyable. With the rising cost of a post-secondary education, the sooner you start to budget, the better off you’ll likely be when you graduate. In 2025, the average annual cost of tuition is nearly $8,000, which works out to be roughly $31,000 over the course of a four-year undergraduate program. That’s an additional $4,000 compared with the average tuition price in 2021.*

While it may seem like a daunting task, knowing and tracking your budget is the first step to ensuring your financial well-being. Here’s what you need to know about creating and maintaining a student budget.

What’s a student budget and why is it important?

Think of a budget as your financial game plan for the school year. It balances your income against your expenses to help you live within your means by determining in advance where your money goes, so you don’t come up short at the end of the month. This will help you pay the big bills on time and curb impulse spending. By setting realistic limits and ensuring your essentials are paid first, you can avoid accumulating debt early on and help maintain your overall financial health.

How to budget as a university student

Now that you have a good understanding of what a budget is and why it’s important, let’s explore how you can create your own. Follow these six key steps to build a budget and start managing your money this semester: 

1. Build a simple snapshot

Try not to overthink it when building a budget: jotting down your income and expenses is enough to start. Whether you log this information in an app on your phone, in Excel or in a notebook, the goal is to see everything in one place. Once you get a good look at the numbers, you can start to make informed financial decisions that help you prioritize how you spend your money.

2. Know how much income to expect

Whether your money is coming from a part-time job, an internship, a scholarship or your Registered Education Savings Plan (RESP), try to be realistic about which sources are consistent and which are temporary. If you’re taking advantage of student loans or lines of credit, don’t forget that anything you borrow will have to be paid back one day. Keeping these details in mind will help you plan without overestimating how much cash you have at your disposal.

3. Understand your expenses

Every dollar you earn or save is precious, so it’s important to allocate your spending wisely. The big expenses, such as tuition and rent, are easy to account for in your budget. It’s the steady stream of daily smaller expenses that can add up quickly. Groceries, transit, phone bills and utilities all chip away at your balance, as will one-offs such as textbooks and course fees.

You’ll also want to budget for things like eating out and any entertainment purchases you’ll make when you’re spending time with friends or blowing off steam after a big exam. And if you’re living away from home, you might also need to set some cash aside for travel. Separating your expenses into must-haves versus nice-to-haves will make your budget more realistic.

4. Do the math: Assess your total income and expenses

Once you’ve figured out how much you’ll have in your bank account, it’s time to subtract your expenses. The number you’re left with tells you what kind of financial shape you’re in. A positive balance means you have money you can direct toward savings, debt repayment or a cushion for emergencies. A negative one means you need to decrease your spending or find ways to increase your income.

5. Track your spending

Even after you draft your budget, you’ll need to review it on a regular basis to ensure you’re staying on track. In the early days, you may want to do this once a week, but as you refine the process, you may feel comfortable reducing the frequency. Picking a regular day and time to see how you’re doing compared with your budget will make it easier to hold yourself accountable.

6. Adjust your budget as needed

As time goes by, you may need to make small changes to your budget to reflect your habits. For instance, if it turns out you don’t need to spend as much on groceries as you thought, you can redirect that money to your savings or another priority. The more you fine-tune your numbers, the more confident you’ll become with your finances.

What’s an average budget for a university student?

Every student’s budget looks different, but most have the same expenses: tuition, books, housing, food, transportation and personal spending. Income sources can be just as varied, but many students rely on a combination of part-time jobs, scholarships and savings. If your parents started an RESP for you, then you’ll want to factor that into your calculation tool (just make sure you’re paying attention to the withdrawal rules).

Here's what a student budget could look like, breaking down the income sources and expenses:

For illustrative purposes only.

In this illustrative example, monthly income exceeds expenses by $75, leaving a small cushion that can go toward your savings, debt repayment or unexpected costs.

Student budgeting tips

Here are some tips to help you stretch your student income and start building up your savings: 

• Take advantage of student discounts: Being a student has its perks, especially when it comes to getting a deal. Many retailers, restaurants, subscription services, transit systems and grocery stores offer student rates, helping you make your money go further.
• Buy used textbooks or rent online copies: Rather than buying your textbooks new, you can save money by getting them second-hand from other students or your school’s bookstore. And unless you plan to reread your Psych 101 textbook, consider renting digital versions of your course materials.
• Cut back on non-essential purchases: Resist the urge to eat lunch out every day or to stop for that second double-double on your way to class, because these small daily purchases can quickly add up.
• Use public transportation: It’s cheaper and less stressful than owning a car. Plus, check with your school to see if there are any student discounts – sometimes you can even use your student card to ride for free!
• Direct your savings toward a TFSA: If you’ve got some extra cash left over in your budget, you may want to set it aside for a vacation, a new phone or anything else you’re saving up for. As soon as you turn 18, you can open a Tax-Free Savings Account (TFSA), giving you a flexible, tax-advantaged way to build savings for your short- or long-term needs.

^* Canadian undergraduate tuition fees by field of study (current dollars)

^† For budgeting purposes, assumes an annual withdrawal of $9,000 from an RESP, spread equally over nine months, the length of a typical school year.

^‡ Assumes a scholarship of $1,125 spread equally over nine months.

** Tuition shown as an average monthly cost by dividing an annual $9,000 tuition bill over nine months, the length of a typical school year.