These days, getting an undergraduate degree is as basic as getting a high school diploma. However, paying for post-secondary education is a whole other issue. It is expected that in Canada, tuition fees will rise 2.5 percent above inflation each year for the next 25 years. This means that in 2035 tuition will be sitting close to $20,000. With student debt currently averaging just above $25,000 for Canadians, it is clear it is only going to get worse before it gets better.
My goal is to reach high-school students before they enter university so that they can take the necessary (and often unknown) steps to avoid this kind of debt completely. In the meantime, I know there are many current university students who are already sitting in huge debt. I currently work with many students who already have $50,000+ in student loan debt. I even work with some adults in their 30’s and 40’s who are still working to pay down student debt.
Why is student debt a major issue for graduates and for the Canadian economy?
How is the government trying to help?
Although the government has some solutions available for student debt in Canada, student debt still sits at over $15 Billion.
What can graduates do to get out of such debt?
The student debt problem isn’t going away anytime soon in Canada. In fact, it is only going to get worse. Debt will continue to rise as tuition and housing costs increase and we will continue to see the negative impact on the economy. That isn't to stay that student loans are always a bad thing. If students take out loans and use them in a smart and responsible way, there can be many benefits to having a loan.
This is why it is critical that high-school students are educated on their financial options before entering post-secondary. Post-secondary student’s should create a carefully designed budget and access all scholarship and awards in order to avoid having loans run your life!
By the time students start school in September, they have limited time to think about the ways in which they could save a few bucks. In fact, many students often don’t think about their finances at all. However, there are many tips and tricks that I used in college that saved me over $6000 in my five years. If you follow these tips, you could save yourself a year's worth of tuition. The best part is they are so simple!
1. RENT YOUR TEXTBOOKS: The cost of textbooks in university is astronomical. Students are often paying $100-$300 per book. Textbook costs for a student can total over $7500 throughout an undergraduate degree. Instead of buying textbooks, I used to rent them. Every the semester I would head to the library before classes even started to make sure I got a copy. It saved me thousands of dollars and if you can’t find the textbook at your university just head to your city library! It also saves you the headache of selling the books after your course.
2. OPT OUT OF HEALTH COVERAGE: Most students receive medical and dental coverage through their university as a student. This cost is approximately $200-$300 a year that automatically gets added to student fees. However, most students are actually covered by their parent’s medical while they are a student. There is zero need for double coverage so if you are covered by your parents then I recommend opting out of university coverage and saving yourself $1000 over the course of university.
3. LIVE AT HOME OR OFF CAMPUS: Campus housing is ridiculously expensive. Particularly as a first-year, because you automatically have to opt in to the meal plan at some schools. First year residence can cost over $10,000. If you live slightly off campus you can cut your living expenses in half! The great thing about being a student is that you some schools give you a discounted bus pass that automatically comes with your school fees.
4. STUDENT DISCOUNTS. Always ask for a student discount! Many places offer discounts to students. Most gyms, cable companies, phone companies, restaurants and retail stores have discounts of up to 25% off that aren’t necessarily being advertised. If you don’t know, just ask!
5. CUT THE COFFEE. For a while, I had a terrible habit of buying a coffee every day at school. Spending $2.50 on a coffee may seem insignificant. But when you add up those costs over a month it can end up costing more than your phone bill. Buying a coffee maker could save you $750 over the course of a year. Obviously, I am not speaking strictly coffee. Whatever your indulgence may be, try to find a cheaper option.
I have been getting a lot of questions regarding student loans and I thought I would go over some basics! I have been asked questions such as how they work, how risky they are, how easy they are to get etc. So I thought I would take some time to write a blog post about them.
I will start by saying that contrary to what many parents/students think, student loans can be positive. Why do I say this? Well not only is it money that just sits in your bank with no interest to pay on it while in school, it also opens up many opportunities for funding from outside sources. Let me tell you a bit about what I did:
I decided in my fourth year of university I was going to go onto exchange to the University of Edinburgh. However, I was a little concerned about how much it would cost and my parents said that if I wanted to do it, I was responsible to save up the money to go. Although I made quite a bit of money in the summer, I wanted to be able to travel and I needed a safety net in order to do that. That was the point when I started looking into student loans. Prior to my fourth year, student loans weren’t even on my radar because I had been pretty successful with other scholarships and awards.
I got approved for a loan in my fourth year for something like $12,000. I had no intention of ever spending that money, but I wanted it just in case. So I put the money in a TFSA (Tax Free Savings Account) and let it earn interest. Little did I know, that by taking out a student loan, I suddenly qualified for many other scholarships and awards because I was in “financial need.” By the time I actually left to the UK, I had done over $10,000 in scholarships solely due to the fact that I had a student loan. There is a lot more funding for people who are in “financial need,” which is something I wish I had known in my first year.
Now that isn’t to say that there isn’t some negatives to student loans. Student loans can be difficult to access straight out of high-school because students often fall under their parents income regardless of how much their parents can actually contribute. Taking out a student loan requires you to have a certain degree of financial literacy. For some students, when they see $30,000 sitting in their back account, I am sure their instinct is to buy whatever they want. I was very diligent in making sure that I didn’t touch it (and luckily I didn’t need to). As a student you have to remember that a loan is still repayable. However, all of the wonderful scholarships and awards you may receive because of the loan won’t be repayable :)
With the recent Bell Let’s Talk initiative, I thought it was important for me to write my first blog post about financial stress and mental illness.
First off, it is so important to provide a platform for those dealing with any type of mental illness and to end the existing stigma that is associated with mental illness. We need to be there for each other and support one another so that nobody faces a mental illness alone.
The entire Bell Let’s Talk campaign has got me thinking a lot about what might cause mental illness and some of the struggles faced by students with mental illness. A big part of the reason that I started GrantMe is because many students are faced with high levels of financial stress. Studies show that students leaving post-secondary school with huge amounts of student debt are likely to have poor mental health upon graduation. Similarly, first year students coming into university who face financial stress among the many other stresses of university, are also more likely to face mental health issues throughout university.
Although many universities have attempted to solve these problems by giving access to resources for mental health, it is equally important that students are equipped with the financial education required to make the university experience less stressful. This is where I believe there is room for improvement. Many resources and tools are available to students in order to help them pay for school, but they are difficult to navigate and are often not directly promoted by the university.
Many students faced with a high degree of financial stress are suffering silently. Nobody wants to tell there friends that they are struggling to eat and pay rent because they are scared of what others might think about them. That sort of stigma is why many students aren’t able to get the required help they need. I can’t reiterate enough the importance of speaking up and supporting one another on all mental health issues. Although Bell Let’s Talk is a one-day initiative, the conversation around mental health is not.
I encourage everyone to take an active role in asking your friends, family, coworkers and even a stranger how they are doing. It seems so simple, but it could be saving a life. Lastly, if anyone is facing financial stress, or any other type of stress for that matter, I AM HERE FOR YOU, TO LISTEN AND HELP. So no matter what you are facing, always feel free to reach out to me.