Did You Know?: A Seven Part Series on Understanding Your Student Loan

The next seven articles are largely geared towards new graduates who are/ or will soon begin to repay their government issued student loans. Although this information is specific to the province of Ontario, most provincial governments adhere to the same policies/rules when it comes to student loan repayment. However, you should still check your provinces regulations to see if this applies.


(1) Why you should pay back some of your student debt while you are still in school:

If you are able to make some extra money while you are still in school it may be wise to start repaying your debt before you graduate. Why? Because interest on your debt is not accumulating when you are full time post-secondary student. All you owe is the principal.


OSAP allows you to earn $103 a week (or $412 a month or $1,648 a semester) without it affecting your student loan amount the following semester. This may not seem like a lot at first but if you saved $1,648 every semester for 4 years (not including summer classes), you would have $1,648 X 2 semester X 4 years = $13,184. This does not even include the odd year you decided to take summer courses, or even any interest in savings. If you put this money in an ING savings account at 2%, the savings can be beneficial over a four year span. So that is over $13,000 you could use to pay towards your student loan without even affecting how much OSAP you could get while you’re still in school.
Of course if you want to earn more than that, even better. Just make sure you weigh the cost and benefit of balancing school and work and not to mention how making more money while in school may affect your OSAP loan the following semesters. However, in the long run, the less you owe, the faster you can think about other investments when you graduate, like a new home or contributing in various investment vehicles. This will be a later topic.


Follow @debtfreedomfind

What is eINFO?

I thought I would start my first informational blog on educating others about a 'one-stop' website for information on all Ontario universities scholarships & awards, residence and program information.  This website is called eINFO and can be found by clicking here:

 http://www.electronicinfo.ca/en/

Here are some of the benefits of using this website:

• The site uses a program wizard that consists of a filtering system that not only allows you to find a post-secondary education program easily, but it also allows you to compare similar/different programs offered at different universities in Ontario. This information is presented in a comparative table that is to understand.
• The site allows you to search scholarships & award information by schools, annual dollar value and application requirement (or any combination of the three). So if an entrance scholarship is a critical factor in choosing where you want to go to school, you can see where your GPA will give you the biggest monetary reward.
• Another key feature this site offers is residence information. Find out the cost of on-campus living, meal plans etc, as well as compare this price with other universities in Ontario.
• Lastly, this site allows you to save your searches for future use, once you create a username and password.  

Why is this information important for reducing your debt? Well I believe in a preventive approach (as appose to a reactive approach) to financial planning. In other words, if you can avoid a situation that will put you further into debt, it is much better than trying to get out of debt after the fact. Knowing as much information as you can about the financial opportunities and expenses about the post-secondary school you wish to attend can save you hundreds to thousands of dollars over the next 4+ years of your education

Follow @debtfreedomfind

About Me

I am a recent  grad  who managed to rack up a total of $6,000  is credit card debt and $63,000  in government student loan debt.  This total includes funding for both undergraduate and post graduate  degrees.  It is understandable to assume that as a business graduate (accounting, then general MBA) I should have a sound foundation in personal finance (specifically debt finance).  But alas, like most graduates and most in society, $63,000 can get you a whole lot of education yet it is amazing how much the hallowed halls of collegiate education fails to teach you.


Many business students are able to  calculate the financial worthiness of  companies large and small, but are unable to recall how the last $40 in their wallet was spent. I know this because that was me circa. undergraduate – postgraduate. Like the 50%+ Canadians (http://www.statcan.gc.ca/daily-quotidien/100129/dq100129c-eng.htm) that use OSAP to assist in funding theireducation, you probably weren’t informed about  the available options (which I will begin to mention in future blogs) while in school and the responsibilities that come with using debt as a financing tool.


High student debt and an overinflated salary expectation results in a reality check for most students, at least it did for me. Granted the current jobs market isn’t like it was five years ago, but jobs were available in many recessions before this one and will be available after. So, competiting for work with other graduates shouldn't be your only focus. Sometimes your biggest competitor is the lender who loaned you that credit card or student loan.

For this reason, I have decided to create this site. With the goal of not only educating myself, but hopefully others.These articles will be geared towards post-secondary students and recent graduates. The way I see it, it's never too late to get serious about paying down your debt and building wealth, and the best time is now.

Follow @debtfreedomfind