Students succumb to tuition debt

With the cost of college tuition on the rise, students can often feel they’re withdrawing money from their accounts by the hand full.  (PHOTO by Mandy Matthews)

The rising cost of tuition is forcing students to become more financially responsible.

According to Statistics Canada, more than one- half of all Ontario college students graduate with student debt. The study concluded that between 1995 and 2005 the average student debt upon graduation rose by $3,600. The Ontario Secondary School Teachers Federation released a report in 2012 emphasizing the increase of university and college tuition since 2007. The study showed tuition rates increased faster than inflation throughout those five years. Inflation increased by five per cent, while tuition fees increased by about 20 per cent. The report notes that on average, it can take graduates more than seven years to repay their student loans. As of 2011, the average student debt in Ontario at graduation is $27,000.

Nate Hope, a 24-year-old St. Clair College student, is paying his tuition with the money he earns as an apprentice brick layer.

“During that time there was a lot of things I was unsure of,” said Hope. “I was confused at where I should direct my finances at that point.”

He said he made the decision to enrol at St. Clair after attending one year at the University of Windsor where he accumulated a debt of $8,000. Before entering college, he put about $330 a month toward his debt until it was paid off. He is now looking to start putting money away to buy a house after he starts back at the University.

Aside from tuition debt, eighty per cent of graduating college seniors also have credit-card debt before they have a job, according to Dave Ramsey’s book called The Total Money Makeover.

Wendy Dupuis, executive director of Financial Fitness Windsor Centre said it is within reason for students to go into debt while pursuing a college education.

Dupuis said it is important to develop a financial plan in order to avoid “extraordinary debt.” She said extraordinary debt happens when people borrow money to finance a lifestyle they can’t afford, which makes their debt unmanageable.