No one wants to take out a student loan. Most are forced to out of financial necessity and some have trouble paying their loans back after they graduate.
This is where credit counsellor Christi Quinn of the Credit Counselling Society comes in. Her job is to help students manage their debt before it becomes detrimental.
“About 25 per cent of students who receive student loans experience a lot of difficulty having to pay them back, especially in the early years after graduating,” she said. “When students come into my office, I find there’s a misconception about how long it takes to pay back student debt.”
Quinn notes that on average it takes five to seven years to fully pay back student loans.
Second-year U of W education student Rio Bare took out a student loan this year to help pay for her tuition.
“It’s a big bummer that I have to pay something back, but because it’s my first year it’s not that big of a sum,” Bare said.
She hopes to pay it off by the end of the year and is considering taking out another one next year.
“If I needed, I would definitely look into a credit counselor for help, but it hasn’t gotten that bad yet,” Bare said.
According to Quinn, credit cards are often a culprit in adding to a student’s debt problems.
“The majority of students I see lack money skills to ensure success after graduation,” Quinn said. “Every 18-year-old gets a credit card right away and often it’s racked up on things they don’t need.”
While her services are offered to anyone in need of debt help, Quinn often sees students who don’t realize how credit systems work and end up paying more money in the long run for their short-term needs.
“If you were to put $5,000 on a credit card, were to have (an) 18.9 per cent interest rate and paid the minimum payment every month, the total cost of borrowing would be $13,068.42 paid over 28 years,” Quinn said.
Quinn also encourages students to start a financial budget, and to visit university services like financial aid for help.
“It’s really challenging to avoid debt for students, which is part of why we try to advocate for lower tuition fees and provide what supports we can from the University of Winnipeg Students’ Association (UWSA),” said Katie Haig-Anderson, vice-president advocate for the UWSA.
Haig-Anderson also notes that the UWSA provides short-term, interest-free, emergency student loans and job opportunities on campus.
Quinn encourages students to get help, no matter what stage of debt they are in.
“The most important thing if you’re feeling any sort of financial strain is to get help sooner than later,” she said. “Know that if you’re struggling with debt that you’re not the first person. Being a student is difficult, so before you feel overwhelmed, ask for help.”
Visit the Credit Counselling Society at 208-428 Portage Ave. or visit their website at http://www.nomoredebts.org
Published in Volume 65, Number 11 of The Uniter (November 11, 2010)