Tuition fees. Textbooks that weigh ten pounds each. Parking passes that never guarantee a space. Degrees that cost upwards of $90,000.
For the love of god, why would anyone want to go back to school much less accumulate more debt because of it?!
In all, one in eight Canadian families are carrying student debt, with a median value of about $10,000, StatsCan reported. There was a total $28.3 billion in outstanding student debt in 2012, the survey found.
Yet Canadian students’ debt burden “pales in comparison with the U.S.,” writes BMO economist Sal Guatieri, noting that south of the border, student debt grew 110 per cent between 2005 and 2012, to almost $1 trillion.
Source: The Huffington Post
At some point in our lives, many of us contemplate going back to school, whether it’s simply for professional development in our current career or to make a complete career change. For me, it’s the latter. Although I enjoy sales and love dealing with people, I’m finding myself underemployed, feeling unfulfilled and lacking in that everyday hurrah that gets most of us out of bed at 6AM – the strong desire to go to work. I want to move into the next evolution of my career and take my current sales and consumer behaviour/psychology experience and expand upon my original marketing degree from way back when.
So why in my right mind would I be willing to take on more debt?
Being divorced for four years, on my own and in my late thirties, going back to school part time can seem like a scary prospect; both financially and emotionally. No one likes extra debt. Least of all someone like me who has had a propensity for shopping, has hefty car payments and is still making her way through the consumer debt repayment journey.
There are very good reasons to go back to school.
Earning Potential. By increasing my value to an employer, I increase my earning potential. It also shows a willingness to be a perpetual learner and that you are motivated towards success in your career.
Career Change, happiness and fulfillment. There does come a point in one’s life where a change is necessary in your career, it could be your current situation is no longer challenging or you’re just no longer passionate about it.
Get a promotion. Sometimes going back to school gives you that extra edge you need at work to become an “expert” at what you do and impress your employer that you’re willing to go the extra distance for a promotion. It shows dedication.
Learn something new. Not everything necessarily has to be for work. Always wanted to play the piano, or learn to dance? Sometimes just a little extra learning for you can work wonders in your career.
Fufill your dream. Always wanted to be a lawyer? Well, it’s never too late. Many people I’ve come across in the past four years have all said to me “You can still do that, go back to school. It’s never too late!”
Why Education is Debt I’m Okay with – Good Debt vs Bad Debt
In my opinion, I see a much better return from debt incurred through education than through shoes, dresses or other silly consumable items. (Imagine that, eh? Out of the norm for me isn’t it.) Think of it – if someone were to ask you why you’re in debt, which of the two evils would you prefer – I’m a shopaholic or I went back to school so I could earn more and be contributing to a career I’m passionate about. Not a difficult answer is it? I don’t like the idea of extra debt period, especially when I’m working my butt of to purchase a condo/house and trying to get rid of that last $24K of consumer debt that just won’t seem to go away, but I’ve realized for my own sanity I must do this. Thankfully, I already have a degree in marketing and I’ll only have to go back to school part time.
Good types of debt are those that offer a return of some kind, such as Education, Business Ownership and Real Estate. Others suggest that even short term investing is okay to incur debt for but I disagree. There are too many variables when borrowing to invest.
Bad types of debt are pretty much everything else! Cars, boats, clothing/consumables, credit cards, lines of credit.
A study last year from TD Bank found students are increasingly delaying major life milestones due to the rising costs of education, with the situation being made worse by a sluggish post-recession job market. That survey found average debt load sits at around $27,000.
Source: The Huffington Post
Keeping back to school budget friendly
While I won’t be incurring $90,000 of debt to get an MBA, when it’s all said and done I will still have roughly $6300 in tuition costs (over 2 – 3 years) along with the cost of text books.
Shop Educational Institutions. You have your choice of school, so shop wisely. Many institutions offer similar courses but at varying prices, it can change just based on geographical location. On the other side of the coin, sometimes cheaper is not better, be sure to research the course, professors and the school to ensure the cost is justified. In other words, is it too good to be true?
Do online instead of in class. This will save you on the incidentals like parking, public transportation, and meals. Online is also much easier to fit into your schedule as there isn’t always a set class you have to attend, most is at your own pace.
Buy used textbooks instead of new.
What do you think: is education good or bad debt? Have you gone back to school for career development or a career change?
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