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Welcome to my page where we will explore the relationship between students, government funding agencies, equity, and student debt/loan repayment to assess, how it affects the economy, student mental health, and future goals. The object is to provide resources to educate and assist with debt repayment and resources for students pre and post-graduation to lead their best life while they chase their dreams.

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This video follows creator Dan on his journey to repay $40,000 in student loans over two years but it also offers advice to students at the beginning of their higher education journey.  From choosing an affordable school, gaining knowledge about Financial Aid opportunities and repayment periods. Dan then lays out his tactics for loan repayment and offers tips to help others pay off their debt quickly.

I chose this unique video because it was not only informative, but also very relatable and entertaining. Dan has a very realistic view of the education system and highlights the issues surrounding entry-level job salary vs. student debt load. Making sure you pick a program with a high ROI for your education investment is extremely important. Dan's journey was well planned and strategic. He chased his dreams with his eyes wide open and it is paying off.

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STUDENT LOAN DEBT: What I Wish I Knew (Canada)

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Martin’s video is similar to Dan’s in that it walks you through the Canada Student Loan process. The difference between the two is that Martin draws attention to the Student debt crisis which sits at 28 Billion dollars as of 2018 and the rising cost of tuition. He highlights opportunities for funding, choosing the right schooling option for your goals, eligibility, deadlines, types of funding, alternatives for those who cannot access institution-based funding, bankruptcy and provides tools for budgeting.

The reason I chose to add this video is that Martin draws attention to the predatory practices of payday loans and that bankruptcy is not a solution to unpaid student debt as it is not always forgiven and has damaging long-term effects on your credit. By acknowledging the long-term negative effects of poor financial planning on your life he encourages people to be informed and helps them plan to avoid a worst-case scenario.

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What Every Student NEEDS to know about OSAP (Student loans Explained) | avoiding student debt canada

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This Global News report on student debt from 2019 sites $36 billion in government student debt alone with 4/10 students paying off their debt in 4- 9 years. They highlight a student named Alexandra who started accumulating debt in 2008. Alexandra pursued three different degrees but only started accumulating debt after her second and third-degree which cost $62,000 in tuition and ancillary fees, but her total debt accumulation landed at $105,000 when she factored in living expenses and additional schooling expenses like equipment and books. Next, they feature Doug Hoye's work. He studies the student debt crisis and notes that women have a harder time paying off loans because are less likely to be employed when they owe money and most of the grant money given out by the government was for women. Global adds that women’s earning potential is also hindered by career breaks to have children and lower average pay for equal employment when compared to men. In Alexandra’s case, she is ruling out Canadian job prospects that do not pay as well for American opportunities. They conclude by laying out Alexandra’s plan to repay $1000/month over 8.5 years to eliminate her debt.

I chose this video because although Alexandra’s case is rare, we don’t all pursue three degrees in 13 years, women need to be aware of the issues that will present themselves when they begin to repay student loans, enter the job market and know how systemic issues will affect their timeline for having children long term. We should be fighting to close this equality gap collectively and making sure that our best-educated citizens are not leaving the country for better pay elsewhere.

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Which Canadians may struggle the most to pay off their student loans?

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Russell talks about the Federal Loan repayment freeze during Covid-19 for six months to ease the load for students who were unable to work during the pandemic and ensure that they can afford the necessities of life. Employment numbers in Canada had been on the rise pre pandemic but the number of unemployed recent graduates is still startling high in the unemployment pool. Russell looks at the relationship between extending student loan forgiveness long-term and how it can be advantageous to the long-term sustainability of the economy. This is achieved by increasing the buying power of younger cohorts thus stimulating the economy and creating more jobs long term as well. Another way this is effective is that it produces financial sustainability, which in turn encourages more young entrepreneurs, who grow their business’ and create new jobs. Russell also looks at election promises in the US by now president Joe Biden, who promised a $10,000 student forgiveness program to assist students who graduate their program. He is optimistic that Canada will follow suit if this initiative moves forward. Although this is not likely to occur immediately it does offer hope to future graduates and may be a fairer form of student debt relief vs. complete loan forgiveness.

I chose this video because of its political highlight. Many students surpass the opportunity to vote or think that it is not important to them. If Russell is correct and the US does impose debt forgiveness for graduates that makes its way into the Canadian economic plan or a leadership promise, voting could be the best 10 minutes you’ve ever spent with a $10,000 ROI attached to it! This of course means that you would have to align with the political party in other important aspects of their policy and plan, but I hope that it inspires more political involvement long term for young adults who seek change.

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Student Loan Forgiveness For Canada? | What Happened is Good News for Students AND All Canadians

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This article highlights the limits that student debt places on young people, especially marginalized populations. This cohort represents one of the hardest hit by Covid-19. The author suggests that alleviating student debt and encouraging entrepreneurism is the most effective measure to kick-starting and strengthening the economy post-Covid. Entrepreneurs are essential to economic growth, job creation, innovation and healthy competition, having been an often-overlooked component to economic increases and with declining governmental support, entrepreneurial enterprises have been on a steady decline in the last five years. The author suggests that debt relief provides a more stable economic foundation which will encourage more young people to follow their entrepreneurial dreams.

I chose this article because I found the author's view unique and innovative. Stimulating entrepreneurial growth and reducing student debt repayment to strengthen the economy as a long-term strategy, instead of short-term band-aid fixes, seems like a more strategic approach to economic stability. The author also highlighted the federal “Repayment Assistance Plan” which is a valuable resource for low-income student debt holders who need could benefit from assistance.

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Creig Lamb is a senior policy analyst for the Brookfield Institute for Innovation and Entrepreneurship at Ryerson University in Toronto
Starting a business is risky. Starting a business amid a pandemic is riskier. Starting a business amid a pandemic with nearly $18,000 in student loan debt is much, much riskier.

In October, the federal government resumed collecting repayments and charging interest for roughly one million Canada Student Loans borrowers after pausing for six months. This temporary deferral brought some much needed financial relief to many of Canada's youth, who remain among the hardest hit by the COVID-19 pandemic.

But as many advocate for an extension to the freeze, perhaps now is also a good time to discuss more permanent measures to address student loan debt in Canada. Such measures would not only support graduates as they navigate the immediate challenges of the economy, but they could also add some much needed fuel to Canada's entrepreneurial engine, which will likely need a serious boost after the pandemic.

Over the past few decades, as relative government funding for postsecondary institutions declined, tuition fees have increased. Students, as a result, have taken on more and more debt to pay for school. Half of Canadian students who graduated in 2015 held student debt, owing a median of $17,500 at graduation. By 2018, almost two-thirds of these graduates still had outstanding debt.

While there's limited public data on the demographics of borrowers, it's reasonable to deduce that, since eligibility is based on family income and financial circumstances, the burden of student debt falls disproportionately on already marginalized groups, such as racialized and Indigenous populations.

All of this debt takes a toll. Individuals with outstanding student debt have fewer assets and lower savings and investments compared with those who don't. Student debt can also result in insolvency. To graduates saddled with large debt loads, entrepreneurship might not seem like a viable option. And yet Canada's future success depends, at least partly, on translating the world-class talent coming out of our postsecondary system into new businesses, whether they succeed, or fail, or land somewhere in between.

Entrepreneurs are a vital component of any economy, creating jobs, spurring competition and inducing innovation. While Canada is often lauded for its robust startup ecosystem, the rate of new entrepreneurship has been on a decades-long decline, which likely will become more pronounced in the coming months or years.

Despite entrepreneurs' critical role in the economy, starting a business is an uphill battle. Between 2002 and 2014, 63 per cent of companies survived their first five years - and 43 per cent were still standing after 10. For those holding student debt, this hill can be much steeper. A number of U.S.-based studies have shown that student debt load has a significant adverse effect on entrepreneurship.

Entrepreneurs need money and often use their own personal savings to start their businesses. Individuals who are paying back large student debt loads simply have less to put toward a prospective venture. Those with large outstanding loans may also have more difficulty accessing additional debt - the most common source of financing sought by Canadian firms - to finance their business.

Even if it's possible to secure a business loan, servicing the accumulated debt requires stable, steady income, which may take a new business many years to achieve, if at all. In the fairly likely event that a new business fails, those holding student debt risk default, and the potentially severe consequences that come along with it. As a result, those with debt are more likely to choose safer career paths.

There is help for those who struggle to pay their student debt. The federal Repayment Assistance Plan, for example, allows single-family applicants with household incomes above $25,000 a year to pay no more than 20 per cent of their income on their student debt for six months, after which they must reapply. It also pays the interest not covered by the reduced monthly payments.

Those making less than $25,000 are not required to make payments on their loan at all. RAP was accessed by more than 330,000 people in 2018-19, up 11 per cent from the previous year. However, for many, the available government assistance is simply not enough. In 2018-19, there were more than 356,000 Canada Student Loans borrowers in default.

While there are many good reasons to help alleviate the burden of student loan debt, adding some much-needed dynamism into Canada's entrepreneurial ecosystem should be one of them. Amid and after the pandemic, we should be doing all that we can to give our would-be entrepreneurs a boost. Addressing student debt would help to take some of the risk out of entrepreneurship, evening the playing field for many students looking to start a business.
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Opinion: Could alleviating student debt be the key to restarting Canada's entrepreneurial engine?

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Creig Lamb is a senior policy analyst for the Brookfield Institute for Innovation and Entrepreneurship at Ryerson University in Toronto Starting a business is risky. Starting a business amid a pandemic is riskier. Starting a business amid a pandemic with nearly $18,000 in student loan debt is much, much riskier.

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This link to the National Student Loans Service Centre (NSLSC) website is essential to those considering applying for government student financial aid.  The Federal Loan site is for all Canadian students Nation-Wide. This website will help students from the beginning to the end of their funding needs throughout their education. From applying for loans, creating a repayment plan, budgeting and apply for debt relief during their repayment period. The site is a robust resource and links out to many other helpful government agencies and assistant services.

I chose this article as a resource for those who are just beginning their funding application research and those who may have received government funding but were not aware of these resources to help guide their next steps and structure their repayment plan. This website also represents the most reliable and accurate information available to students because it is a government resource.

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The National Student Loans Service Centre is excited to announce the launch of our newly redesigned website with new features.

Student Loan Forgiveness for Family Doctors and Nurses

Effective November 2023, the Government of Canada has increased the maximum amount forgivable by 50%. This means that eligible doctors can receive up to $60,000 and eligible nurses can receive up to $30,000 in loan forgiveness over a maximum of five years, on their Canada Student Loans. If you are a family doctor, resident in family medicine, nurse practitioner, or nurse working in under-served rural or remote communities, visit Canada.ca for more information and to download the application and Employment Attestation form.

Elimination of Canada Student Loan Interest

Effective April 1st, 2023, the Government of Canada has permanently eliminated the accumulation of interest on all Canada Student Loans including loans currently being repaid. You continue to be responsible to pay any interest that may have accrued on your loan before April 1, 2023.

Enhancing the Repayment Assistance Plan

The governments of Canada, Manitoba, Newfoundland and Labrador, Saskatchewan, and New Brunswick have updated their Repayment Assistance Plan (RAP) eligibility with new zero payment income thresholds and the maximum payments have been lowered from 20% to 10% of a household income. The changes are effective in November 2022. To apply for RAP, log in to your secure NSLSC account.

New Brunswick Interest Elimination

Fulfilling the New Brunswick Government's commitment to make post-secondary education more affordable, as of November 1st, 2022, interest on the NB portion of Canada-New Brunswick integrated student loans has been eliminated. This change benefits all current and future borrowers.

Persistent or Prolonged Disability

Effective August 1, 2022, the Government of Canada is expanding access to disability supports to students and borrowers with a persistent or prolonged disability. This will provide greater support to students and borrowers with a wider range of non-permanent disabilities through grants, in-study supports, and specialized repayment assistance. For more information and/or to see if you are eligible for persistent or prolonged disability benefits, visit Canada.ca.

New Canada-Manitoba Integrated Student Loans

For Manitoba Student Aid borrowers, this means that both the federal and provincial portion of your loan will now be administered by the National Student Loans Service Centre (NSLSC). For more details, please visit: Manitoba Student Aid.

Canada Student Loan Interest Suspension Update

Effective April 2021, the Government of Canada has suspended the accumulation of interest on Canada Student Loans until March 31, 2023.

Did you forget the answers to your security questions?

Once you have signed in with GCKey or Sign-In Partner, if you do not remember the answers to the mandatory security questions, you can create a new user profile by clicking on the "Continue with Interac verification service" button. This will allow us to validate your identity against your financial institution information using Interac verification service.

What happens if I get the answers wrong?

You have three attempts. If you are unsuccessful, your account will be locked and you will be provided with a number to contact for assistance. To avoid being locked out, we recommend that you create a new profile using Interac verification service after your second attempt.

Who can use Interac verification service?

Interac verification service is available to returning registered users who cannot answer the mandatory security questions. Only those with an account with the following financial institutions will be able to use Interac verification service: BMO, CIBC, Desjardins, RBC, Scotiabank, and TD. You must consent that your financial institution will share basic personal information with Employment and Social Development Canada (ESDC).

How secure is Interac verification service?

Interac verification service is a digital identity verification service offered by Interac Corp. Interac verification service was developed in cooperation with six of Canada's major financial institutions along with innovation partners. Interac verification service uses strong security protocols to protect personal information from being identified, accessed or misused. Interac verification service has no access to the credentials you use to log in to your financial institution. You'll be asked to consent to every transaction. You're always in control.

What if I don't have an account with one of those six Canada's major financial institutions covered by Interac verification service?

If you do not remember the answers to your security questions and do not have an account with one of the six financial institutions currently covered by Interac verification service, you will not be able to access your online account at this time. Please contact us to discuss the options available to you to manage your account.

Mandatory Registration for Multi-Factor Authentication

Since June 12, 2021, multi-factor authentication registration is mandatory for all GCKey and Sign-In Partners users.

What is multi-factor authentication?

Multi-factor authentication is a security feature to help prevent unauthorized access to your account.

How does the multi-factor authentication process work?

The multi-factor authentication (MFA) registration is mandatory for GCKey and Sign-in Partners users. To enroll, you must successfully respond to your existing security questions or use Interac verification service.

There are three MFA options users can choose from:

1. SMS text: You will need to provide a cell phone number to receive a security code via SMS. You will then be required to enter the security code to confirm your identity. Once confirmed, you will have access to your NSLSC account.

2. Voice message: You will need to provide a cell phone or landline number to receive a phone call providing you with a security code. You will then be required to enter the security code to confirm your identity. Once confirmed, you will have access to your NSLSC account.

3. Passcode Grid:If you are unable to use a telephone to receive a one-time passcode sent via SMS or voice message, you may use the Passcode Grid option.

The Passcode Grid is a table made up of numbered rows and lettered columns. You will be prompted to enter the correct values from cells that match the column-row combination from this table. You can save or print the grid. Make sure you keep it in a safe place until the next time you login.

After enrolling with MFA, you will have to enter a new security code each time you access your NSLSC account.

What should I do if I have been locked out of my account?

If your account is locked due to entering the wrong multi-factor authentication security code or requesting it too many times, please contact the Registration and Authentication Help Desk at 1-866-279-5238. The hours of operation are from 8:30 a.m. to 4:30 p.m. local time, Monday to Friday, except civic holidays.

Can I disable the multi-factor authentication feature?

A reset option is available if you:

lost your device;

got your device stolen; or

changed your phone number.

For additional questions on multi-factor authentication, please contact the Registration and Authentication Help Desk at 1-866-279-5238.

Canada Student Financial Assistance Program (CSFA Program)

As announced in Budget 2021, the Canada Student Loans Program has changed its name to Canada Student Financial Assistance Program (CSFA Program). The Program was renamed to highlight the fact that the Government of Canada provides a range of student financial assistance supports beyond student loans. Please note this change will not impact your Canada Student Loan(s) and Grants, or related benefits.

New Features

2022

August 2022

Schedule a Personalized Payment Reminder

One less thing for you to remember! Log in to your secure NSLSC account and update your Communication Preference to receive monthly reminders about your next payment amount and due date straight to your secure inbox.

2021

December 2021

New YouTube videos out now

Set yourself up for repayment success by learning more about your payment options, including the Repayment Assistance Plan (RAP). Visit us on YouTube .

October 2021

Checking the status of your RAP application just got easier!

Curious about the status of your RAP application? Log in to your secure NSLSC account and check your application status from your Dashboard.

More ways to connect!

Looking to get in touch with us? Check out our redesigned Contact Us page for more ways to connect with us.

July 2021

Avoid a Surprise! Calculate your Monthly Payment

If you have a full-time loan, you can prepare for repayment by calculating a monthly payment amount that fits your budget before your payments begin. Log in to your secure NSLSC.ca account and select Customize My Payment Terms from the My Account menu.

We're Making it easier to Stay Connected

We're bringing our Twitter feed (@NSLSC) to you! Our latest Tweets are now visible on the NSLSC homepage. Log in to Twitter to follow us, like, or comment.

May 2021

The Learning Hub

Explore the Learning Hub for the latest tools and tips to help you successfully manage your student loan and keep your financial future on track.

Updates to the Repayment Assistance Plan (RAP) Online Application

We want to make things easier for you, so we've updated the online RAP application for a more seamless way to apply.

Stay Connected

Follow us on Twitter and subscribe to our YouTube channel so you don't miss a beat when it comes to the latest updates and information.

March 2021

New Videos Out Now!

Whether you are just starting on your post-secondary journey, or transitioning to repayment, we are here to support you with helpful tips and tools to make you feel more confident about your financial future. Check us out on YouTube.

Have a question? We have answers!

Use the Instant Answers function at the bottom of the page for general questions about your student loan(s). If we don't have the answer you're looking for, you can connect with a live agent. Our agents are available to chat with you in real time Monday to Friday, from 8:00am to 8:00pm your local time.

Your Repayment Assistance Plan (RAP) Details All In One Place

Your new and improved Loan Details page includes a summary of RAP details for easy reference.

Loan Statement Update

Wondering how your payments are applied to your student loan(s)? If you have a federal and provincial portion on your student loan(s), you are now able to view how each payment and interest is applied!

Go Paperless!

If you are set up to receive communications by mail, log in to your secure NSLSC.ca account to update your communication preference to email today.

January 2021

Customizing your Payment Terms just got easier!

You can now customize the payment terms of your full-time student loan(s) online, even if you are behind on payments. If you want to see what other repayment terms may fit your budget better, you can now do this through your secure NSLSC.ca account.

Behind on Payments?

If you need help making your loan payments, the updated Virtual Repayment Counsellor can advise full-time student loan borrowers with past due payments what repayment options are available to help bring their loan(s) back into good standing. Log in to your secure NSLSC.ca account and select this feature under the More Information section on your Dashboard.

Do you have your mobile number on your profile?

Let us know whether the phone number(s) you have on your profile is your mobile number or home phone. Log in to your secure NSLSC.ca account and select My Profile in the My Account drop down menu to update. If you do not have your mobile number on your profile, make sure to add it so it's easier for us to stay in touch!

Let's Chat!

We're making it easier for you to connect with our agents! If you have any general questions about student loan(s) and can't find the answers on the NSLSC website, send them to us through the new online chat channel. Our agents are available to chat with you in real time Monday to Friday, from 8:00am to 8:00pm your local time.

2020

October 2020

Medical and Parental Leave

Effective October 1, 2020, the Government of Canada introduced a new Medical and Parental Leave for students taking temporary leave from their studies for medical or parental reasons, including mental health reasons. It offers interest and payment-free for six-month periods, up to a maximum of 18 consecutive months. For more information and/or to see if you are eligible for the Medical and Parental Leave, visit Canada.ca.

Your Funding Details All in One Place

Your new and improved Dashboard now includes a summary of all your funding details for a quick view when you need it. Log in to your secure NSLSC.ca account to check out the new dashboard!

March 2020

Managing Your Money

It is always the right time to start thinking about your finances. Visit our new Managing Your Money page for some tips to help you create or stick to a budget. This will help set you up for success when it comes time to repay your student loan(s).

Customize Your Payment Terms Online

Changing your student loan repayment terms has never been easier! If you have a full-time loan that is up-to-date, and you want to change your monthly payment amount or simply see what other repayment terms may fit your situation better, you can now do this through your NSLSC account. No more calling the NSLSC, no more paper forms, simply log in and update your repayment terms with a click of a button.

2019

November 2019

Virtual Repayment Counsellor

Entering Repayment? If you have a full-time loan, you have a Virtual Repayment Counsellor to advise what debt management benefits are available to you.

Make a Payment Online

Making payments on your student loan is now easier than ever. Log in to make a payment using the banking information on your NSLSC account.

August 2019

Funding Tracker

If you are a full-time student, you can now view the status of your funding request anytime with the new Funding Tracker available when you log in to your NSLSC account.

Automated Payments

Making payments on your student loan can be quick and easy. You can now set up Pre-Authorized Debit when you log in to your NSLSC account to make your student loan payments virtually effortless.

June 2019

New Registration Process

In April 2018, the NSLSC launched a new registration and log in process using the Government of Canada's authentication process for students who were required to complete a Master Student Financial Assistance Agreement (MSFAA).

This is now available to all NSLSC users and is required to access your online account going forward. The registration process includes setting up a new username and password with GCKey or using your financial institution log in with a Sign-In Partner. Start your registration now.

Electronic Master Student Financial Assistance Agreement (MSFAA) for Part-Time Students

Both full-time and part-time students can now complete the process electronically.

Profile Update

You can now easily update your contact details and banking information online. Log in to explore the new and improved NSLSC website.

We hope you will find it easier to navigate and find what you are looking for quickly and efficiently.

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This website summarizes the student debt crisis in Canada. The nine-year study found that in 2018 student debt insolvencies reached a record 1 in 6 or 17.6% of all insolvencies in Ontario representing 22,000 former students. The negative effects of these statistics are far reaching in terms of future economic profile and a direct reflection of the economy’s current status. These statistics only represent a taste of the actual student debt load as private student load and debt transfer are not accounted for in data collection. Other factors like the rising price of tuition, job challenges, delay financial obligations/repayment and accumulating more debt post schooling have all lead to quicker average insolvency rates. Ultimately the multifaceted nature of Student debt, forgiveness or waiting period to begin repayment and other contributing factors complicate the debt repayment process and leave many choosing between collections or independence post-graduation.

I chose this video because it laid out student debt information clearly and shone a light on the current student loan crisis. I think it is important for people with student debt to know that others struggle as well.

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Student debt insolvencies on the rise

Student debt in Canada is in a crisis. We say this because we see the negative consequences of more and more young people taking on student loans, in higher amounts. In 2018, student debt contributed to more than 1 in 6 (17.6%) insolvencies in Ontario ¹, a record rate since we began our study nine years ago. Extrapolate this Canada-wide, and that means that roughly 22,000 ex-students filed insolvency in 2018 to deal with their student debt.

That may not seem like a lot but put in perspective with the number of student loan borrowers in relation to the overall population, the young age of these borrowers, and the relative health of the economy in recent years, and it is an epidemic.

In this report, we take an in-depth look at the student loan crisis in Canada and the profile of the average insolvent student debtor. We explore who are defaulting on their student loan debt and why they are filing insolvency at an increasing rate.
Note: In Canada, consumer insolvencies include both personal bankruptcy and a consumer proposal, both student debt forgiveness options under the Bankruptcy & Insolvency Act.
Student debt in Canada

It's hard to get a handle on the amount of student debt outstanding in Canada. As of the 2016/2017 school year, Canada Student Loans (CSL) was administering a portfolio ² of $18.2 billion dollars in loans to more than 1.7 million borrowers.

In 2016/2017, Canada Student Loans disbursed $2.6 billion in loans to 490,401 students. While loan disbursements dipped in the most recent year, over the past ten years, CSL has disbursed 47% more in loans to 31% more students than in the previous ten years.

However, on top of the federal government guaranteed loan program, graduates are also financing their studies through additional provincial student loans and private loans.

For students in full-time study in participating jurisdictions, approximately 60% of their CSL assessed financial need is funded by the Government of Canada through federal student loans, while the province or territory covers the remaining 40%. How much is in loans, and how much is grants, varies by province based on political objectives. In Ontario in 2017/2018 for example, OSAP funded ³ almost $1.7 billion in financial aid, only $200 million of which was repayable loans, with the remainder being grants. The year before funding of just over $1 billion was split 60% grants and 40% loans.

Private student loans are another matter, no-one reports on how much is out there.

A National Graduates Survey ⁴, conducted by Statistics Canada, revealed that while government loans are the most common source of debt for students, 27% of graduates from the class of 2009-2010 used only non-government loans and 25% relied on both government student debt and non-government debt.

While the average undergraduate completed university with an average debt load of $26,300 in 2010, if students supplemented government student debt with a student credit card, bank loan or student line of credit, their average debt balances upon graduation ballooned to $44,200. That means that the average student using private loans on top of their government-guaranteed loans increased their debt load by 68% through private lenders.

Rising tuition contributing to insolvencies

The average undergraduate tuition for a Canadian university ⁵ is now $6,838, and tuition has risen at an annual rate of 3.7% over the past ten years. In Ontario, the average tuition is now $8,838, up an average 4.6% per year over the past ten years. And this is before compulsory fees, costs of books, school supplies, and residence.

Much of the cost of post-secondary education is being financed by student loans. Despite the introduction of the Canada Education Savings Grant program and tax-sheltered RESPs, over 40% of post-secondary students ⁴ finance their education through loans - either government-guaranteed Student Loans or private student debt. This number rises to 50% for university undergraduates.

The issue is that this debt lingers. Only 34% of bachelor graduates had fully paid off their student loans three years after graduation. According to Canada Student Loans, students typically take between nine and 15 years to pay off their student loans in full. But some don't get there; they declare insolvency (file bankruptcy or make a consumer proposal to creditors) first.

Insolvency being declared much sooner for student debt

Our study shows that tuition hikes are taking their toll on graduates. Higher debt upon graduation is just not sustainable, contributing to many graduates declaring insolvency much earlier than in the past.

Graduates are declaring insolvency much sooner after graduation. The average age of an insolvent student debtor in 2018 was 34.6 compared to 35.7 in 2011 after peaking at 36.1 years in 2012.

While more likely to be in their 30s, three in 10 student debt insolvencies are filed by those aged 18-29 and insolvency among recent graduates is increasing.

To have student debt dissolved in a bankruptcy or consumer proposal, the debtor must have been out of school for at least seven years. This is why the average age of an insolvent debtor is in their mid-30s. They have been out of school, and struggling with repayment, for years. Those who file insolvency with student-related debt still owe an average of $14,729 in student loans representing 32% of all their unsecured debt.

Federal and provincial student loan and grant programs such as OSAP have helped increase enrollment in college and university programs among young Canadians but have also resulted in high post-secondary dropout rates. Historical studies ⁶ by Statistics Canada report a university dropout rate of 16% and a college dropout rate of 25%. Yet these are people who unfortunately still must repay their accumulated student loans, a challenge when they are unable to find suitable employment. Students who did not successfully complete their studies can also have their student debt eliminated, but must wait for their end of study date to be more than seven years before they file their consumer proposal or bankruptcy.

Job-related challenges lead to student debt default

While most student debtors cite poor management of finances as the number one cause of their debt problems, almost one-third (29%) stated that job-related or income issues contributed to their financial problems.

The Canada Student Loans program reported ² a three-year default rate of 9% in 2015-2016. While the default rate is on the decline, this is due primarly to increased use of the Repayment Assistance Program (RAP). CSL reported a total of 305,769 borrowers in the Repayment Assistance Plan, roughly 12% of all direct loan borrowers. What is revealing is that the first year RAP uptake rate has increased over the past five years.

Graduates leaving university often end up working in unpaid internships, part-time positions, and minimum wage jobs. They are increasingly unable to find a stable job with enough income to support both student loan repayment and living expenses. This has contributed to an increase in the percentage of insolvent debtors with unpaid student debt.

If this cycle continues for the minimum seven years after they attended school, and they are still struggling with repayment, a bankruptcy or proposal becomes an alternative for debt relief.

People filing insolvency with student loans are working, in fact, 86% reported being employed. It is the quality of their job and income that is at issue.

The average income for an insolvent student debtor in 2018 was $2,430 - 4.7% below that of the average insolvent debtor without student loans.

Delaying financial obligations and accumulating post-graduate debt

Repaying student debt after graduation takes more than just simple budgeting to pay back this level of loans. The obligation to pay back debt at such an early age creates a cash flow crunch when most are earning a lower than average income. Individuals struggling to repay student debt are unable to build an emergency fund, save for a home, and keep up with student loan payments. Some turn to credit card debt to makes ends meet, and a staggering number of insolvent student debtors use payday loans. In 2018, 45% of student debtors had at least one payday loan at the time of their insolvency.

Payday loans and other revolving debt create a cycle of debt accumulation post-graduation that contributes to their insolvency. In 2018, including student loans, the average insolvent student debtor owed a total of $46,373 in unsecured debt.

It is, however, still student debt that is their primary problem. Student loans account for 32% of their total unsecured balances.

Student debt more of a dilemma for women

Even more concerning, overwhelming student debt is primarily a problem for women. In 2018, 61% of student debtors were women.

This ratio is consistent with Canada Student Loan figures ². In 2016-2017, 61% of grants & loans were distributed to women. CSL also reported that 65% of RAP recipients are female.

The female student debtor (Jane Student) is struggling with more student debt than her male cohort. Jane Student owes an average of $15,171 in student debt, 8.2% more than the average male debtor with student loans, a trend that has occurred consistently since we began our study.

A woman filing insolvency is less likely to be employed at the time of insolvency. In 2018, 83% of female student debtors were employed compared to 90% of male student debtors.

Jane Student struggles to find employment after graduation. The 2009-2010 Graduates Survey reported that while 79.4% of male students were working full-time three years after graduation ⁷, only 71.9% of female graduates were successful at finding a full-time job in that time. Even if she does find employment, Jane Student is much more likely to be out of work for other reasons including maternity leave and childcare, affecting her ability to maintain a stable income source.

It is this susceptibility to having an intermittent income that makes it difficult for Jane Student to keep up with her student loan repayments. Consequently, she has a higher student debt level than do male student debtors.

Women filing insolvency are also much more likely to be single parents than men. Looking at student loan debtors, only 8% of men are single fathers while 34% of women with student debt are single mothers. As a result, Jane Student is struggling to balance both childcare costs and student loan payments on a single income. Compounding this Jane Student has a household income that is 3% below that of male student debtors.

It's time to eliminate the waiting period

The recent federal budget ⁸ has attempted to make student loans more affordable. While student loan borrowers can choose between a lower floating rate - tied to prime - or a fixed interest rate, 99% of student borrowers choose the variable rate option. The federal government lowered the variable rate to prime and made the initial 6-month payment grace period interest-free on the federal portion of the loan.

In Ontario, interest charges during the grace period on OSAP loans resumed for those graduating as of September 2019 reversing the cost advantage provided by the previous government.

The federal government has instituted a Repayment Assistance Program to help students facing financial hardship with student debt repayment. If the applicant can prove financial hardship, they are entitled to interest relief under Stage 1 for a period of up to 60 months. After that, if still struggling, they may be entitled to both principal and interest relief. Many insolvent student debtors are either participating in this program or do not qualify under the stringent hardship provisions. For many, the postponement of payments does not help when they are also struggling with other debt. And this is contributing the increase in student bankruptcies and consumer proposals in Canada.

When repayment assistance is not enough, student debtors turn to the Bankruptcy & Insolvency Act to resolve their student loan debt; however, they are subject to a waiting period of seven years. Section 178(1) of the act does not release or discharge a debtor from:

any debt or obligation in respect of a loan made under the Canada Student Loans Act, the Canada Student Financial Assistance Act or any enactment of a province that provides for loans or guarantees of loans to students where the date of bankruptcy of the bankrupt occurred(i) before the date on which the bankrupt ceased to be a full- or part-time student, as the case may be, under the applicable Act or enactment, or(ii) within seven years after the date on which the bankrupt ceased to be a full- or part-time student;

Simply put - if you have government-guaranteed student loans, you must wait seven years from your last date of study to have these loans discharged in a bankruptcy or consumer proposal.

To complicate matters even more, students can apply for a hardship ruling to have the waiting period reduced to five years if they "experience financial difficulty to such an extent that the bankrupt will be unable to pay the debt". This requires a court application, with the assistance and expense of a lawyer, and is very difficult to obtain.

Yet if you have private student debt - a bank loan, credit card, or student line of credit - these debts are included in a consumer insolvency and discharged with no waiting period.

It is our opinion that the waiting period for student loan discharge should be eliminated. There is no valid reason to treat government student loans different from private student loans. The intended use for borrowing is the same, no matter the source. These are monies used to pay for the cost of education and living costs. Students do not have to support where they spent the money. OSAP and CLS can be used to pay for tuition, room and board, clothing, food, or any expense while in school not unlike their credit card or line of credit.

If not eliminated entirely, the waiting period should be tied to both the length and benefit of the program they attend and hence expected outcomes. If they drop out of school after one year, they can have any loans discharged after waiting one additional year. If they attend a three-year program, they should be required to wait no more than three years to be eligible for discharge.

It is time we stop saddling an entire generation with debt from which many cannot fully reap any benefit.

Profile of the Average Student Debtor

The average student debtor owes $46,373 in unsecured loans, including $14,729 in student debt. The student debtor is more likely to be female, single, with or without a dependent.

Sources (first instance & charts):

1. Hoyes, Michalos Bankruptcy Study

2. Canada Student Loans Program statistical review 2016 to 2017 https://www.canada.ca/en/employment-social-development/programs/canada-student-loans-grants/reports/cslp-statistical-2016-2017.html

3. Ontario Student Assistance Program annual report http://www.auditor.on.ca/en/content/annualreports/arreports/en18/v1_310en18.pdf

4. Graduating in Canada: Profile, Labour Market Outcomes and Student Debt of the Class of 2009-2010 - Revised: Section 4 https://www150.statcan.gc.ca/n1/pub/81-595-m/2014101/section04-eng.htm

5. Canadian undergraduate tuition fees by field of study https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=3710000301 and Canadian graduate tuition fees by field of study https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=3710000401

6. Participation levels, graduation and dropout rates by December 2005 https://www150.statcan.gc.ca/n1/pub/81-595-m/2008070/figures/6000093-eng.htm

7. Percentage of 2009-2010 university graduates working full-time, three years after graduation https://www150.statcan.gc.ca/n1/pub/81-582-x/2015003/tbl/tble2.6-eng.htm

8. Federal Budget 2019 https://www.budget.gc.ca/2019/docs/youth-jeunes/youth-jeunes-en.pdf

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Student debt in Canada is in a crisis. We say this because we see the negative consequences of more and more young people taking on student loans, in higher amounts. In 2018, student debt contributed to more than 1 in 6 (17.6%) insolvencies in Ontario 1, a record rate since we began our study nine years ago.

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This Government of Canada website provides resources and assistance for former students who are struggling to repay their student loan debt. Exceptions and special programs during Covid-19 are highlighted at the beginning of the article with existing debt repayment assistance in the form of payment support and reduced monthly payment programs. Loan collection, debt rehabilitation and bankruptcy resources round out this page for those who have already found themselves in a difficult financial situation.

I chose this article as a resource for students struggling so they know where to turn after school ends. This video is useful because it identifies reliable resources and ways to gain financial assistance that is not related to private corporations who may have ulterior motives and potentially destroy people's credit leaving them worse off at the end of the day.

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Please read our latest notices:

Having trouble making a payment

If you are having trouble making a payment, you have options:

Missing a payment will negatively affect your credit.

Contact us to discuss options

Whether you have missed a loan payment or not, contact us to discuss options to help you get back on track:

Getting your loan out of collection

If you have missed 9 months of payments, your federal student loan will be sent to the Canada Revenue Agency (CRA) for collection. Once in collection, you are no longer able to get student aid. To be able to get student aid again, you must bring your loan up to date.

Contact the CRA to make a payment arrangement and bring your loan up to date.

For the provincial or territorial part of your student loan, you will need to contact your province of permanent residence. For borrowers from Saskatchewan you may contact the CRA for both federal and provincial parts of your student loan.

Rehabilitate your Canada Student Loan

If your loan is in collection, you may be eligible to bring your Canada Student Loan up to date. To do so, contact the CRA to see if you are eligible to rehabilitate your federal student loan. Make payments equal to two regular monthly payments and choose one of the following options:

1. Pay off all outstanding interest on your loan, or

2. Add all unpaid interest to the balance of your loan. You will receive a new payment schedule for the new balance.

Note: The option to add the unpaid interest to the balance of your loan can only be done once.

Once you make your payments, call the NSLSC and ask to speak with a Canada Student Loans Program agent. You should receive a new repayment plan within one month.

Bankruptcy doesn't erase student loans during the first 7 years

Be aware: if you file for bankruptcy within seven years of finishing your studies, your Canada Student Loan won't be cancelled. You will have to continue paying back your Canada Student Loan.

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Repay a student loan - Can't repay your loan

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Please read our latest notices: If you are having trouble making a payment, you have options: Missing a payment will negatively affect your credit. Whether you have missed a loan payment or not, contact us to discuss options to help you get back on track: If you have missed 9 months of payments, your federal student loan will be sent to the Canada Revenue Agency (CRA) for collection.

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To me, this image perfectly portrays the heavy burden of student loan debt that many face chasing their career dreams. I think the artist was also expressing the fact that the weight of debt acts as a mental barrier that weighs heavy on current students having a harmful effect on their mental health which can halt graduation goals leaving students without a diploma and in debt. This is very counterintuitive.

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I find this image empowering and hopeful for future generations. It is important that our attitudes shift to reflect progress. My hope is that we all lead by saying "Let's do better for future generations" instead of "I struggled through it, so should you".

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This image is an important snapshot in time. Covid-19 rocked the world leading many to be unemployed in a rapidly shrinking job market. Many had to chose between paying rent or paying students loans. A student loan moratorium was introduced for a period of six months to relive this burden. As Covid-19 lockdowns and  restrictions  continue to impact people financially many are left facing the same dilemma again without any government support.

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This Image is striking to me and from the same series as the first image. This artists work is incredible. We are taught that education is the path to success and student debt is a part of that journey, but what happens when you find yourself educated, in debt and unemployed? This Image shows a graduate who is anchored by debt and education instead of empowered by it. An accurate portrayal in the current job climate. I appreciate that the dollar symbol is so small in this image too. This speaks to the fact that student debt is minimally talked and educated about but plays a huge role in the forward momentum of people's future.

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I learned that societally it is hard for those who have been born into unfair financial circumstances to succeed in many facets of advancement but through education we have finally started to build a more equitable Student Financial aid program in Canada- but we still have much work to do. Post-education debt continues to hold many back from investment and growth opportunities and at times, I think it is fair to say that the education received does not ensure employment or a base salary that supports the cost of living and student debt repayment. Many of the articles I have included, and others that I read, suggest that by reducing student debt and investing in a more equitable post-secondary school system we are more likely to build and sustain a successful economy long term. This is relevant to me as I navigate my student loans after graduation and has empowered me to fight for a better system for my children’s futures. To my family and friends, I would ask them to consider their student loan journey or in some case lack thereof. How would their lives have been different if they did not have student loan debt? How would it have been different if they DID have to take on student loan debt? How can we work to hold both government and education institutes accountable for the inequality in the system and level the playing field for all?