Loans a harsh lesson for students

Students in the Waikato are responsible for $865 million of New Zealand's whopping $10.2 billion student loan bill.

But it's not all that bad.

Our borrowers are better off than students in any other main centre, as they have the lowest average student loan.

Waikato students have an average loan balance of $16,700 while Otago/Southland borrowers had an average loan of $19,350.

But although the figure is lower, some Waikato students have racked up a fair amount of debt.

Student Reid Lidington said his loan would most likely reach about $90,000 by the time he finished his pilot training this year.

Cafe co-owner Aaron Maisey said the student loan process was a problem because many students were unaware of how much they were paying and how much their debt would end up being.

"Because we never see the money change hands we have no idea of the value of it. I mean, I've got friends that are studying, literally seven years after they started and each year they've picked a different major," he said.

Wintec graduate Hannah Good said her loan was $50,000 but she had paid off about $1000 in the past year.

"I haven't made any voluntary payments. I'd like to get it paid off because I'd like to move overseas." .

Ms Good said her loan was high as she had completed both a Diploma in Marketing at Eastern Institute of Technology and a Bachelor of Media Arts at Wintec.

She said her advice to future students was to "borrow as little as you can and work as much as you can".

Computer salesman Paul Barlow still has $63,500 in debt from study he finished four years ago.

Mr Barlow racked up the debt while completing a Bachelor of Arts (Hons.) in Screen and Media Studies and a Master of Arts in Film and Television.

The aspiring filmmaker said students "need to get smarter" about what they are borrowing for, and he wished he could sort out his debt faster.

"I knew taking the loan I would have to pay it back but it's frustrating that it will take me 50 years to get that done," he said.

"It's too easy sometimes, you just fill in a form and the Government pays for it."

Mr Barlow said his student loan was a burden when trying to look after his family in tough times.

"It would be very, very nice to have that extra money floating around."

Meanwhile, Student Job Search sales and marketing manager Dean Jervis said that Waikato loans were lower most probably because more students were employed part-time while studying.

He said that over the past year, Student Job Search had listed around 3000 vacancies, with $15 million in potential earnings.

"It's good money," he said.

A lot more students were working while studying because several potential employers are encouraging students to have an employment background before heading into the full-time workforce, he said.

"Even the notorious employers of A+ students are saying now that they recognise that a student can lock themselves in a room for five years and come out with an A+ average, but they are giving preference to students with a B+ degree and a work history," he said.

This was down to employers realising the value of understanding a workplace, and developing a good work ethic, and having a job also showed employers dedication and motivation.

"It doesn't need to be course-related employment, it just shows them you have the ability to work hard."

Waikato Times