Student Loan Debt-Help & Advice

Student loans are one of the most common debts for Canadians. Many will have to take out a loan each year to cover their tuition fees which can add up to a large bill by the time they graduate.


Higher education is something most of us strive for. Getting your degree is often the stepping stone between you and your dream career and according to membership organization, Universities Canada, there were 1.7 million university students in 2017.

However, your degree often comes with a hefty price tag. In 2018/2019 students will pay an average of nearly $7k per year for tuition alone, which according to Statistics Canada, is up 3.3% from previous years. Factoring in your general living costs and this can all mount up to a rather substantial bill by the time you graduate.

Now, all graduates are given a six-month non-repayment period to allow you time to prepare to begin paying your loan(s) back. However, interest does build up in this time and it is often suggested that you make payments to clear this in the interim. Many students will graduate with as high as $27k debt and according to the Canadian Student Loans Program, this will take most of them at least ten years to clear.

In an article posted by the Financial Post, it was reported that tens of thousands will fall into default with their student loans each year. Many will also be reported to a credit bureau which affects their ability to obtain mortgages, rent an apartment and even getting a job.

The government does offer repayment assistance plans for those who are struggling, if you contact them in enough time. If you default on your loans for more than 90 days, you then forfeit the option to utilize this option.


Many students will graduate with as high as $27k debt and according to the Canadian Student Loans Program

How Student Loan Debt Can Affect Your Life

University can be stressful, however falling behind with your student debt is not without consequences. This can have an affect on your life in various ways.

Personal Finances

The interest rates for student loans can be as high as 8.95%, meaning that you will end up paying back a much higher amount than you originally borrowed. Most graduates will not immediately get jobs in their chosen field and will end up taking a low-skilled job that will just allow them to get by. If you again factor in the cost of living it is no wonder that people are forced to put off certain things such as saving and investing in their retirement as they struggle to stay afloat. This often will cause people to fall down a hole of taking out further loans and credit cards in order to help them make ends meet.

Another factor to take into consideration is that if you default on your student loan, it is then sent to the Canada Revenue Agency (CRA) for collection. The CRA can then seize the money from your Goods and Services Tax (GST), your tax refunds and even garnish it from your wages.

Mental Health

Understandably, the pressure to do well, get your degree and get a good job affects a large portion of students’ mental health. An article by The Globe and Mail reported that a fifth of Canadians admitted to being depressed or anxious and according to the Mental Health Commission of Canada 75% of first-time mental health diagnoses occur between the ages of 16 and 25.  As such it is no wonder that this will carry into their lives post university.

Knowing that what lies at the end of your degree is a substantial amount of debt, it is no wonder that many will experience issues such as stress when it comes to paying it back. In an article by Global News, it was reported that 77% of Canadians have regrets about the amount of student debt they generated whilst studying.


It is well documented that financial strain is a major cause of divorce, according to an article published by CNBC 1 in 8 divorces are actually caused by student loans. This is mostly because the burden of the debt can often impact on new couples’ ability to buy their first home, getting married or having children. If you are reported to a credit bureau for defaulting on the loans your credit rating will be affected, this could then have an effect on your professional life as it can prevent you from getting a job, which ultimately can impact on your career.

Warning Signs

If you’re feeling the strain of student debt, the following signs will likely be familiar to you:

  • Defaulting on priority bills such as utilities
  • Taking out further lines of credit such as credit cards or loans
  • Feeling stressed or anxious about paying the loan back
  • Leaving yourself without enough money for necessities
  • Avoiding the topic with others

Many people will hide their debts from others, but if you think someone you know might be in trouble with their student debt, you might notice the below signs:

  • They become secluded, spending less time with friends or family
  • Having several lines of credit
  • A clear change in a relationship (if you are a couple)
  • Showing signs of irritation or stress when the topic is brought up

It isn’t always easy to know where to turn when you are struggling, it is always suggested to contact your loan provider or the government to find out if you can apply for repayment assistance.

How to Get Help

Student debt can be scary and there are many ways to deal with this. The points below are some steps you can take to try and regain control of your finances and get back on track:

Talk about it – Sometimes all it can take is opening up to someone and talking about your struggles to help you face the issues you are having.

Get Some Advice – Speak to the loan provider, they may be able to work with you and negotiate a better payment plan for you. They may also be able to help you budget for this.

Get Help – At Money Advice Canada we know how stressful debt can be, and we will always do our best to relieve you of this stress. Our experts will always listen to your situation and offer you free and confidential advice to help you find the best solution for your circumstances.

Warning Signs

In 2018/2019 students will pay an average of nearly $7k per year for tuition alone

How we can help you with your debt?

You’re on your way to resolving your debt problems, this is what will happen next.

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We will then run through all of the options available to you and advise you on which is the best option for you
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We will then help you put the debt solution in place that will help you get back on track

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