Prime income earning years gone- How many go so far into debt when highly skilled trades pay over 100 k a year.
Is this poor planning- and why can she not find a job.
Student loans: Debt by degrees | Personal Finance | Financial Post
Gabi Hager was 30 years old when she went to university for the first time in 1995. After 13 years of continuous school, she graduated with a PhD in analytical chemistry in 2008.
During her first degree she borrowed $56,400, her master’s cost her another $31,000 in debt and in 2004, while doing the PhD which she believed would lead to a six-figure job, she maxed out government loans at $87,000.
Some of that was forgiven by government student assistance programs along the way, but today she is still $58,000 in debt and, even worse, the career she had dreamed of is dead in the water, the result of industry cuts to research and development.
“When I went into debt, the idea was that the loans were based on prospective career,” said Ms. Hager, now 47 and unemployed.
“What people kept telling me was that unless you have a master’s, you’re not really considered for management positions.”
A survey published by the Bank of Montreal in May found that 70% of businesses in Canada require post-secondary education for new hires and almost a third require some kind of specialized training. BMO noted the findings were consistent with Statistics Canada data that showed the number of jobs filled by people with post-secondary education more than doubled between 1990 and 2010 to 4.4 million from 1.9 million.
Ms. Mitchell said today’s students also receive less government assistance and have to pay a higher price for education as the cost has been rising faster than inflation.
The other disadvantage with the bank line of credit, he said, is that the money was handed to him all at once — $10,000 per year – instead of government funding which is calculated on an as-needed basis each year and split over each semester. After four years he had maxed out the $40,000 limit but said he would “100 per cent” have kept borrowing if the limit was higher.
“It’s kind of weird because with the student line of credit, you get it all at once. So, in first year I just kind of went nuts. … In a way it was kind of irresponsible to give me that much money,” Mr. Hinton said. In hindsight, Mr. Hinton said he wishes he had received better financial planning advice.
Mr. Lumsden said students who need to borrow money should have a detailed budget and repayment plan, that includes being aware of interest rates. “One of the things that we’re very regimented on up front is when they need to come to talk to us they need to come with a budget,” Mr. Lumsden said.
Overall, Mr. Lumsden said education debt is a reality for most students so it’s important to do as much research as possible before borrowing. “You’re making a financial investment in yourself and, next to your home, it’s probably one of your bigger financial investments,” Mr. Lumsden said.
Is this poor planning- and why can she not find a job.
Student loans: Debt by degrees | Personal Finance | Financial Post
Gabi Hager was 30 years old when she went to university for the first time in 1995. After 13 years of continuous school, she graduated with a PhD in analytical chemistry in 2008.
During her first degree she borrowed $56,400, her master’s cost her another $31,000 in debt and in 2004, while doing the PhD which she believed would lead to a six-figure job, she maxed out government loans at $87,000.
Some of that was forgiven by government student assistance programs along the way, but today she is still $58,000 in debt and, even worse, the career she had dreamed of is dead in the water, the result of industry cuts to research and development.
“When I went into debt, the idea was that the loans were based on prospective career,” said Ms. Hager, now 47 and unemployed.
“What people kept telling me was that unless you have a master’s, you’re not really considered for management positions.”
A survey published by the Bank of Montreal in May found that 70% of businesses in Canada require post-secondary education for new hires and almost a third require some kind of specialized training. BMO noted the findings were consistent with Statistics Canada data that showed the number of jobs filled by people with post-secondary education more than doubled between 1990 and 2010 to 4.4 million from 1.9 million.
Ms. Mitchell said today’s students also receive less government assistance and have to pay a higher price for education as the cost has been rising faster than inflation.
The other disadvantage with the bank line of credit, he said, is that the money was handed to him all at once — $10,000 per year – instead of government funding which is calculated on an as-needed basis each year and split over each semester. After four years he had maxed out the $40,000 limit but said he would “100 per cent” have kept borrowing if the limit was higher.
“It’s kind of weird because with the student line of credit, you get it all at once. So, in first year I just kind of went nuts. … In a way it was kind of irresponsible to give me that much money,” Mr. Hinton said. In hindsight, Mr. Hinton said he wishes he had received better financial planning advice.
Mr. Lumsden said students who need to borrow money should have a detailed budget and repayment plan, that includes being aware of interest rates. “One of the things that we’re very regimented on up front is when they need to come to talk to us they need to come with a budget,” Mr. Lumsden said.
Overall, Mr. Lumsden said education debt is a reality for most students so it’s important to do as much research as possible before borrowing. “You’re making a financial investment in yourself and, next to your home, it’s probably one of your bigger financial investments,” Mr. Lumsden said.
