The Commerce Times

Shaking off the burden of student debt

Students are desperate to pay off their increasing pile of student debt. Courtesy of Amanda Hutteri

March 16, 2010 1 | By Victor Hsieh

The biggest concern many students face, other than the prospects of finding a job after graduation, is their growing student debt. Statistics Canada reported in 2009 that bachelor’s graduates owed an average $20,400 in debt. Interestingly enough, those who had non-government loans had higher debt levels than those with government loans. Although campaigns like Drop Fees are fighting tuition hikes, student debt is still on the rise.

Fortunately, there are ways students can eliminate or at least reduce their debt.

The first thing students could do is control their expenses. It is much easier to save a dollar than to earn one. Eliminate wasteful spending and look for creative ways to save on necessary items. Utilize all the free facilities/events available on campus and around the city. Walk or bike to school instead of taking public transportation during the warmer months of the year.

Another great way to tackle student debt is through bursaries and scholarships. Bursaries are generally offered to students who declare financial need and scholarships are offered to students who meet a certain criteria of achievement. Regardless, everyone should apply for both of these because it is free money that does not have to be repaid. Even if you are hesitant because of your academic standing or your work load, applying is still a good idea. There is nothing to lose and everything to gain.

Working part-time is also common among full-time students. Apart from adding work experience to resumes, it provides cash-strapped students with extra income. There are plenty of part-time jobs available on campus (visit http://www.ryerson.ca/jobs/) and the wages are very decent. With proper time management, part-time employment can be integrated into your full-time school schedule without much stress.

Moreover, students could negotiate payment arrangements with their lender. As long as payments have been prompt, some lenders are willing to bend rules. Among these arrangements include interest reductions. This will result in lower monthly payments or reduce the time to pay off the loan.

Finally, students should take advantage of the six-month grace period after graduation. During this period, no payments are required on the principal. It is an optimal time to pay down as much of the loan as possible.

So, why is getting rid of your student loan as soon as possible the smart thing to do? The amount of debt you carry could affect your ability to purchase a home later on. Let’s also not forget that having an outstanding student loan is a burden.

If none of these tips work out, there is always the option of selling your organs. They are probably worth more than your textbooks and will get damaged anyway as you get older.