What Should I Save For? Debt Solutions For Every Life Stage

No matter our age and life stage, it seems we’re always shelling out for one of life’s big milestones – but that doesn’t mean debt has to be a regular growing pain. Whether you’re a busy student, single and loving it, just married, or working towards retirement, there are ways to live happily and tackle the associated expenses – without racking up a ton of debt in the process. Let’s take a look.

 Scraping By As A Student

The reality: If you’re lucky enough to have your parents pay for your university years then you likely won’t have to rack up a lot of debt during your time there. Many students, though, have to pay their own way, which means accepting hefty student loans.

Debt-saving tips: Instead of relying on government-backed student loans, which can provide you with more than you technically need, spend your summer months working extra hard to save up for the next year’s tuition. Live as frugally as possible during your time at school. Save money by living with roommates, making inexpensive meals and traveling by bike. The more you save now, the less stressful it will be once you graduate.

For many, venturing off to post secondary school is often the initiation to the world of credit cards – and this can lead to debt disaster if not kept in check. First off, it’s important for parents to educate their kids on the dangers of using credit before they head out on their own. Second, keep student-friendly features in mind when choosing a first card. The MBNA Rewards Studentawards MasterCard is once such option with no annual fee and a standard interest rate of 19.99 per cent.

Trying To Save While Single

The reality: Getting established on your own costs money. You have to shell out for furnishings and rent on your single-person salary. Not only that, but you also don’t have the luxury of sharing your utility bills and rent with a significant other. The bills that you accrue are your own to pay, making it difficult to save – especially if you’re trying to pay back that student loan in the process. 

Debt-saving tips: Budget and live frugally wherever possible. If you’re not opposed to living with someone, take in a roommate to help cut costs. It’s easy to overspend on entertainment costs when you’re on your own. Create a budget with an entertainment fund and stick to it. Any extra money you have should be set aside for the down payment on your first home or retirement (it’s never too early to think about retirement).

Get A Head Start On Married Life

The reality: Once you and your significant other decide to tie the knot, there are a number of unavoidable costs that arise as a result. Weddings, for one, are not cheap. While it is your big day, if you keep your costs down, you won’t have to spend the next ten years of your married life paying it off. Marriage not always, but often, leads to children – and children lead to the need for more space. Did you know that it costs over $200,000 to raise each individual child from birth to 19? And that doesn’t include the cost of the roof over your heads. Along with mortgage and bill payments, you’ll be expected to pay for extras such as repairs, maintenance, dental bills, summer camps, sports and vacations. Believe me, it adds up. If kids are part in the picture, it’s also a good idea to start saving for their education now (and save them some of the trouble of scraping by) with a high-interest savings account or GIC.

Debt-saving tips: First of all, keep your wedding costs down as much as possible. Yes, it’s a big day, but since money is the main cause of divorce, why not start your life together with a clean slate? Start a savings plan for an emergency fund. Your emergency fund should cover 3-6 months of your expenses and will help to cover those unexpected expenses as they arise.

 Getting By In The Golden Years

The reality: According to a recent study, older people aren’t entering their golden years debt-free. In fact, many of them are still spending as much as they were when they had a regular income. The reality of retirement is very different than some seniors had envisioned it. These days, pensions are less assured, and retirees are finding themselves with less savings and more debt than they expected. 

Debt-saving tips: The most obvious money-saver is the home. While many retirees try to maintain a lifestyle they once had, it isn’t always feasible – both financially and physically. A good first step is downsizing. A smaller home will be easier to maintain and the day-to-day expenses will be lower as well. Even in your golden years, a well-planned budget is a good idea. You should always know how much you can afford to spend and stick to it.

It All Comes Down To Saving

As you enter each phase of life, you’ll be better equipped if you enter virtually debt-free. Really, the key is to start out smart and keep at it. It’s easy to get swept up by debt. At the very least, if you follow this principle, you should be fine: Save often and never spend more than you can afford.

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