February 22nd, 2018

Student loans impacting decisions

By Kuhl, Nick on November 19, 2017.

Many taking jobs outside of chosen field

Demi Knight

Southern Alberta Newspapers

With the number and amount of student loans rising, as more and more Albertans look for help to fund their post-secondary education, it seems many might be concerned about what happens after graduation and how to pay back their loans.

Once degrees, diplomas and apprenticeships have been acquired, the looming debt can seem a little daunting. In fact, a new poll released by BDO Canada shows many Albertans delay major life decisions due to student debt.

Furthermore, country wide 40 per cent of graduates in Canada regret taking on student debt at all.

Senior vice-president of BDO Canada, Craig Fryzuk, says paying back loans has always been on students’ minds but the recent economy and rise of tuition may play a major part in these new findings.

“My feeling is that student loans have always been an issue as far as paying them back because people have always graduated with debt and had trouble with paying them back. However, with tuitions on the rise and jobs not increasing as fast as tuition, millennials may have more default with debt.”

The study released earlier this year also showed nearly one in four Albertans delay marriage and 21 per cent are deciding to delay starting a family due to the burden of loans. The study also showed two in five Albertans delay home ownership while another 27 per cent choose to stay living at home to better reduce their outgoing costs.

Although the numbers may be startling, there must be a reason for the growing concern.

With the fluctuation in tuition and the economy not being able to keep up, some students are worried they may be falling too deep into debt that their career will not be able to pay off.

“Because of tuition being higher there has definitely been an increase in concern over the past 20 years; the amount of student debt that we’re seeing is certainly higher,” says Fryzuk, who added the lower job rate straight of school is a factor.

“Without coming out of school and making a large amount of money, and if they have a lower-paying job, you have to remember that not everybody will fall into dream job. People have to turn to another resource to pay off that student debt. A lot of the time that results in people taking a job outside of their chosen field.”

It isn’t just high tuition that has students worried about their loan repayments, but also the dip in the economy, causing them to need more money to survive while in school, thanks to the rise in rent, and the lack of jobs.

A statistical review from the Government of Canada recently released stated that since the school years between 2010 and 2015 the number of students accessing loans in Alberta has risen to 50,885 from 47,503.

The total amount of loans in Alberta has also increased over the last five years, growing from $252.3 million in the 2010-11 academic year to $285.9 million in 2014-15.

These facts from the review show Alberta has seen one of the most substantial growths in Canada in money borrowed by students since 2010, second only to Ontario.

But with student debt comes the reward of post-secondary education. Fryzuk says in a final note that if post-secondary graduates can learn to better budget their finances, there is a light at the end of the tunnel.

“I think the key is that if they don’t have a budget, they need one. I’ve been keeping one for years, it’s that simple. You have to track where your money is going and if the money coming in is equal to or greater than what’s going out.”

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