How much should I save? Top personal finance questions from post-secondary students

School is back in session for B.C.'s post-secondary students, and with that comes tuition fees and anxiety over personal finances.

Mark Ting, a personal finance columnist for CBC's On the Coast, recently sat down with a group of students and recent graduates for a Q&A session.

He shared some of their top questions with host Stephen Quinn.

How much should I save?

Regardless of your income, you should try to save at least 10 per cent of your salary. For people in their 20s, first set up a bit of an emergency fund and then think long-lerm. Millennials tend to be fairly risk averse and overly conservative. But financially, the one huge advantage they have is time. They're young, so they can afford to take on more risk.

From a tax perspective, unless you're making over $50,000 a year, invest your money in a Tax-Free Savings Account. Once you make more money, you can start contributing to your Registered Retirement Savings Plan. And don't be afraid to buy stocks or equity funds.

Should I save for a home or for retirement?

As long as you're saving, you're doing the right thing. Establishing saving habits early on is a big part of becoming financially secure. If you establish those saving habits early in your 20s, you're so far ahead of the curve.

Unless you're expecting to buy a house in the next couple of years, I would default to retirement as your investment. You will retire at some point, whereas you may not become a property owner.  

Should I go back to school?

One of the recent graduates I spoke with couldn't find a job in her field of study and had racked up $14,000 worth of student debt. She was contemplating going back to school, taking a year off to travel or working in a job unrelated to her degree.

When asked what she would study if she went back to school, she really didn't know. She was also worried about adding to her debt, so we quickly scratched that option from the list.

I suggested that she try to get her foot in the door at a medium to large company, as there's often many career paths you can embark on. For example, I started off as a teller at Vancity, but from there I could have done almost anything: investments, management, insurance, human resources, etcetera.

Also, big companies sometimes help pay for your education if you plan on furthering your career internally. That's a big bonus and keeps you from taking on more debt.

Should I take a gap year? 

The recent graduate that we just spoke about had $14,000 of debt and no job to pay it back. It was stressing her out. She also said that she would love to travel, but there was no way she could afford to pay for it.

I asked if she had ever considered working overseas. I did this 20 years ago and had a blast. I also managed to save $40,000 over three years. That would be more than enough to pay off her student loans and keep her out of debt if she decided to return to school.

I also travelled extensively, learned a new language and, most importantly, discovered what I wanted to do career-wise once I returned to Canada.

Is it hard to get a job overseas?

I went through the Japan Exchange and Teaching Programme and would recommend them. They arranged everything. There are some horror stories out there, so do your homework when deciding on an overseas employer.

You also have to be strategic. If your goal is to save money, then live in a small town. I lived 30 minutes from a big city next to a beach. The rent for my three-bedroom condo was subsidized, so I only paid $20 a month.

I was able to save about $1,500 a month without sacrificing my lifestyle or travel budget. Had I chosen a big city, I would have lived paycheque to paycheque and reduced my ability to save.  

This interview has been edited and condensed.

With files from CBC's On the Coast