Am I doing okay?

[hfjake]

Hey everyone, my dad's been lecturing me about personal finance a lot lately and I'm reading a lot of personal finance books. My friends spend all of their money, and everyone says I should stop worrying so much. I want to see what you guys say. Oh, and I'll be staying here to read and post, personal finance is really useful.

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Here's my situation (I'm 19, just finished the first year of my 4 year degree):

Chequing Account: $1430
Saving Account: $2000
TFSA: $400 ($100 is transferred to it with every bi-weekly paycheque of mine)

Tuition Debt: $0
Car Debt: $0

My dad's paying for school, and bought me a used car and is paying the insurance. I feel like a burden, and he's always trying to put away more money for my siblings.

I also have a Mastercard with a $1500 limit, just paying for gas and my cell phone through it to get points and keep a good credit rating for when I'm older. There's $0 owing on it.

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Because of my job I can't calculate an exact annual wage, but I'm averaging 25 hours a week at 10.25/hr right now. Once I get job placements for co-op, I should be making $15+/hour full time for the term I'm off school until I'm done my degree (3 terms of work total, 4 months each so 1 full year).

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Should I relax a little? I hate the idea that my dad's paying for tuition/car insurance because I can't do it myself, if I tried to pay it myself I'd be broke! I'm trying to be independent and mature with my money, my friends are taking out personal lines of credit on top of loans to pay for school and then spending it on parties.

[Eagle]

I want to see what you guys say.

Hi Hfjake! Welcome to the forums!

Personal finance is indeed very useful. It’s good that your dad encourages you about learning about personal finance. You are very fortunate your dad was and is able to help you with college expenses. And buying you a car and paying for insurance is icing on the cake. Think of it this way: understand that Dad lectures you because he cares.

1. What ways can you show your dad you are grateful?

2. What personal finance books are you reading?

Sounds like your friends don’t really have a clue that the decisions they make today will influence the rest of their lives. Particularly their decisions regarding spending habits in their late teens and early to mid-twenties. Those personal lines of credit and parties will have to be paid eventually. It may seem tough now but you’re doing the right and responsible thing.

Graduates of the class of 2013 had an average of 26k student loan government debt. They also had an average of 19k in private loans, 18k in state loans, 13k in personal/family loans, and 3k in credit card debt. So you are going to be way ahead of the curve.

You are making about $1025 a month at your job making 10.25/hr and working 25 hrs a week. That’s pretty good. And if you work the summers making $15 or more an hour that’s even better. $15 at 25 hours a week is $1500. At 40 hours a week it is $2400.

3. Are you still on your parent’s health insurance plan?

4. What major do you think you’ll be pursuing?

[AggieLife]

Hi hf jake,

Welcome to the forums.

You're doing awesome with your finances. Be super grateful your father is paying for college AND a car. That is so nice.

I take care of college and my car by myself and it is a bit stressful but worth it. Always be appreciative and set the example by being financially responsible. Your father works hard for his money I'm sure, so pay him back by being responsible yourself.

Your finances look awesome. No debt is superb. Definitely bulk up your accounts and look ahead to the future. Realize that a family and home cost a lot. So just save up, and even maybe look into investing if that is where you would like to head eventually.

Keep up the awesome work.

[snafu]

Hi Jake, welcome to the forum. Please pass along my respects to your dad for persuading you to pay attention to finance. I think it's brilliant to make regular contributions to your TFSA. When you have a sufficient sum to meet the requirement to open a no cost, low fee Index Mutual Fund, you would be able to automatically DCA [Dollar Cost Average] and build a financial base ready to help you in the future.

I wonder if you'd consider setting aside a sum to contribute to your car insurance annually, semi-annually or monthly as premiums becomes due. If you are working full time during the summer, you could pay some part of books or tuition. I hope you've applied for every award, bursary, scholarship, grant even vaguely qualified. There are thousands of dollars of free money that no one even bothers to apply to. I know they are small sums individually but they add up to significant dollars.

Sadly your friends will eventually discover they have an albatross of debt limiting their ability to make decisions after graduation. Those Personal Lines of Credit and Student Loans will add a ton of deferred interest for them to pay off over 20 - 25 years for beer drunk and forgotten, parties with people whose names are no longer on their cell. Those debts are not forgiven even in bankruptcy. You learn a lot of street smarts as a poor student staying out of debt.

[Retired To Win]

You are doing more than okay, hfjake.

It's really good that you are already being able to tell what not to do from watching your friends and what they are choosing to spend borrowed money on. I think it will make a big difference to you all the way down the line if you get a clear idea of what your financial needs are versus what your wants might be. Really helps you get your financial priorities straight.

Here is a blog post of mine on that topic. You might find it useful.

My Financial Independence Key:

http://retired-to-win.savingadvice.com/2013/12/17/my-financial-independence-key-separating_106169/

Welcome and good luck!

[hfjake]

Hi Hfjake! Welcome to the forums!

Personal finance is indeed very useful. It’s good that your dad encourages you about learning about personal finance. You are very fortunate your dad was and is able to help you with college expenses. And buying you a car and paying for insurance is icing on the cake. Think of it this way: understand that Dad lectures you because he cares.

1. What ways can you show your dad you are grateful?

2. What personal finance books are you reading?

Sounds like your friends don’t really have a clue that the decisions they make today will influence the rest of their lives. Particularly their decisions regarding spending habits in their late teens and early to mid-twenties. Those personal lines of credit and parties will have to be paid eventually. It may seem tough now but you’re doing the right and responsible thing.

Graduates of the class of 2013 had an average of 26k student loan government debt. They also had an average of 19k in private loans, 18k in state loans, 13k in personal/family loans, and 3k in credit card debt. So you are going to be way ahead of the curve.

You are making about $1025 a month at your job making 10.25/hr and working 25 hrs a week. That’s pretty good. And if you work the summers making $15 or more an hour that’s even better. $15 at 25 hours a week is $1500. At 40 hours a week it is $2400.

3. Are you still on your parent’s health insurance plan?

4. What major do you think you’ll be pursuing?

I've been busy, but I'm back! Yeah, my dad definitely cares about me.

1. I've been trying to do well in school, but my marks were just cut short of getting good scholarships. I'll still apply to see though, but I think I'll be getting a ~$1750 grant + possibly a $1000 scholarship from work, but that's it. He wants me to keep the money..
I'm helping around the house and being there for him, and trying to treat him to stuff sometimes. It's hard though, there's a lot going on.

2. I read "The Wealthy Barber Returns", I'm trying to find the first one (we have it somewhere) too. And I've been looking at "The Millionaire Next Door" a bit too! Any other recommendations?

3. I'm on my dad's health insurance plan until I'm done school, so for now I am. My part time job offers health and dental benefits as part time (I know, it's a sweet gig :P) but I opted out since I'm on his until graduation. My mom will eventually get a health plan once she gets her finances together (she left 5 years ago and has been living paycheque to paycheque since, she makes almost as much as my dad but blows it on trips and stuff. Thankfully my stepdad isn't like that).

4. My program is an Honours Bachelor of Commerce degree, the degree is a major in Business Administration. I'm taking a minor in Applied Information Technology, and in the 3rd and 4th years I'm likely specializing in Finance.