Catch-22s - and Solutions - When You Try to Cut Debt at School
Most of the media advice about keeping your student debt low just repeats the same old cliches. Media "guest experts" who string these cliches together must assume that everything is the same today as it was back when they were still in school.
Here's the biggest cliche out there: "Save money: Work your way through school by only taking classes part-time."
Ok, we get the concept. It's a classic strategy from way back when. But Catch-22 policies from governments and campuses now make this less effective. You can still do it, but it may not work for you the way it did for your parents' generation.
Here are 2 examples. This could make a good thread in the Forum if you'd like to share your own examples.
Catch-22 if You're Part-time
You try to cut your student debt by only taking 1 or 2 courses a term so you have more time to work. But in Canada, now you have to take a full-time course load of 3 or more classes or the government charges you interest on your student loans while you're going through school. (Exception: Students who can prove a disability.)
This runs your student debt up in a different way. You borrow less money but pay interest over a longer time. So you'd better do the math before you go this route.
If you can, it might be better to take 3 courses to get the full-time status that saves you from paying interest while you're still in school.
Catch-22 if You're Full-time
You take the above advice and go full-time with a reduced load (3 or 4 classes instead of 5). This lets you work longer, study more so you have a better chance of saving money with a scholarship, or cover commute time so you can save money by living with your parents or in cheaper digs in the suburbs.
Schools are starting to charge "flat fees" instead of charging for the courses you actually take. In these schools, you pay for 5 courses even if you take 3. That would cost you at least an extra 1 or 2 thousand a year in tuition fees. Examples of schools going 'flat fee' are U of T and Brock.
Vote with your feet. If the 'flat-fee' schools don't lose students over this, other schools will follow.
If you can't leave your flat-fee school, don't try to work during term at all. Jam the flat-fee schools by taking 6 or 7 courses instead of 5 and cut your debt by finishing school a year faster. It wouldn't work for everyone, such as those in heavy programs or needing top grades. But for those who just need their 'ticket' with minimum debt, this could be an option.
Whatever your situation, try to think outside the box!
© Jeannine Mitchell 2009-2013
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