Erica (22) is a senior year international student in Toronto. While seeking her career path, Erica also wants to learn how to be more independent and put aside some money as an emergency fund. Her solution is to get a part-time job in her favorite industry, fashion.
STEP 1: Build Career + Emergency Fund
How did you approach getting a part-time job?
I want work experience in Canada, and I am allowed to work 20 hours or less as an international student. Since I’ve always wanted to work in the fashion industry, I looked at big retail stores and brands’ websites in order to apply part-time jobs online.
For my current job, one of my friends actually referred me to the manager. They like the fact that I can speak both Mandarin and English because I can help customers who don’t speak English very well which can translate into more sales for the store.
Do you think this retail job is related to your career path?
I’ve always wanted to do something fashion-related, however, my parents wanted me to get into finance, like investment banking, where I’ve had internships before. Since I study business, I now see myself doing business in the fashion industry. Almost all fashion brands or companies ask for retail experience, so this part-time job can be helpful in my career path.
How do you find 20 hours to work besides the busy life of school, studying and house-work? Are you able to have a social life?
20 hours sound like a lot, but time flies so fast. Most of the time, I just stand in the store and talk to people, which is kind of an exercise for me. I made friends with my colleagues, even with my customers. We sometimes go out together. This work is expanding my social life actually. If I have something really urgent, like exams, my manager could arrange my hours so that it doesn’t affect my studies.
STEP 2: Tax & Money Management
How do you manage extra income and prepare for tax time?
Until now, I’ve just received pocket money from my parents abroad to cover my expenses, and I have used it all. I’m graduating soon, so I want to be a bit financially independent instead of always relying on my parents. With this small amount of extra income, I am able to build savings after covering a portion of my living expenses. Since I will be graduating with an open work permit, I can keep this job while searching for a full-time position.
Tax matters were not so complicated. I filled out a tax form with my basic information when I was hired (along with other paperwork). The company sends me a T4 for my income tax filing. With this income, I can also receive my tuition tax credit back sooner.
STEP 3: Growing an Emergency Fund
What’s your way of putting money aside that you don’t touch?
I’ve set up a pre-authorized money transfer to a separate saving account every month for $200. It’s the minimal amount I can save since my part time income fluctuates depending on how many hours I work. For the month with lots of exams, I can just stay at the $200 deposit.
For the months I can work more, I will manually deposit an extra amount into my account. I check my account through online banking at the end of every month and that’s when I decide what extra amount can be deposited. Once the money is in this saving account, I consider it locked. It’s not the money I touch unless something urgent happens.
Finally, I placed the savings account within my TFSA tax-free account since international students are eligible for TFSAs. It prevents me from paying taxes on any interest my savings earn. I also found it psychologically helpful for me not to touch the fund. Although TFSA is flexible in terms of withdrawals, I feel extra cautious of taking the fund out.
My goal is to put $2,000 aside by July. Then I may buy some short-term investments. I will begin with something easy to understand first.