Open a savings account now. But shop around first! Visit several different banks, credit unions and/or trust companies and ask which accounts they would recommend for you, and what options are offered with these accounts. Ask what services you would be getting, and what the charges for these services would be. In addition to this consumer information, look for a banker you feel comfortable with.

Pay yourself first! As soon as you get your allowance or pay cheque, and before buying anything else, take the amount you want to save and deposit it in your savings account. Many money management experts recommend you save 10% of your take-home pay.

If you have a part-time or full-time job, you are eligible to start a Registered Retirement Savings Plan. An RRSP allows you to save on income taxes immediately, and the interest it accumulates is tax-free. Speaking of interest, the younger you start saving, the more money you'll eventually have. Thanks to the magic of compound interest, compare below what happens when you contribute $1,000 a year for 10 years between the ages of 21 and 30 versus $1,000 a year for 20 years between the ages of 31 and 50.

Taxes

When you get a job, remember that part of your salary will go to income taxes, Employment Insurance, and Canada Pension Plan.

If you get a pay cheque of $800 every two weeks, these are the deductions that would be made:
Canada Pension Plan	$21.29
Employment Insurance	$21.60
Income tax	$122.20
Take-home pay	$634.91

Borrowing

Unless you get an interest-free loan from your mom and/or dad, borrowing costs money. You'll have to pay back not just the money you borrowed, but interest - and the longer you take to pay it back, the higher the amount of interest you'll pay. That's why you should shop carefully for your loan, and understand exactly what you're getting - the interest rate, how it is calculated, repayment expectations, and so on. 

If you do borrow money, make sure you have a repayment plan, in writing, that includes the interest rate, plus how much you'll pay back and when.

All loans have to be re-paid, including student loans. If you default, it will appear on your credit history for a long time.

Credit Cards

Credit cards can help to establish a credit history for you, which will be helpful if you need to borrow money from a financial institution at some point in your life. But a credit card needs to be in your name to be a credit reference for you. 

Not all credit cards are created equal. Interest rates and terms vary widely, and you will also need to consider annual fees and benefits offered. It pays to shop for a card before you shop with a card! 

Be careful not to make a policy of using a credit card whenever you want something you can't afford. Credit cards can be useful for making purchases over the phone. They can come in handy in an emergency. And yes, sometimes the sale of a lifetime happens when you just don't have enough cash in hand. If you do use your card in cases like this, think carefully about how you're going to pay off the amount when it comes due. 

Pay your credit card balance every month. Paying just the minimum means you'll also be paying a lot of interest. For example, if you owe $500 on a credit card with a 12% interest rate, and make just the minimum payment, it will take you five years to pay it off, and your final cost will be $657.49. (This assumes you've made no other purchases during that time period!)

Record-Keeping and Cheque-Writing

Keeping track of your income and "outgo" is the first step, and one of the most critical, in getting control of your money - in making sure that you're using your hard-earned cash for what you really want, both in the short and long terms.

If you have a savings account, it's important to keep a careful record of all deposits, withdrawals, debit payments, bill payments, cheques written and other transactions because if you become overdrawn (you've taken out more money than you put in), it will cost you money. You could be embarrassed when your debit card is refused at a store, or when a cheque you've written is returned (this will cost you money, as well).

5 Golden Rules