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The Pros and Cons of Student Loans

By Ruth-Anne Klassen 

When you are looking for a job that pays better, or a job that is better suited for you, you may find that you need additional schooling to be qualified for the job you are looking for. School can be costly, but student loans provide you with funds to get to school faster. Although you usually must pay back the money, it may be easier to re-pay if you can make a higher income after your studies. Keep reading to find out more about why a student loan may or may not be a good idea for you. 

Pros of Student Loans 

They are a source of funds that get you to school faster. Tuition and other costs for post-secondary or adult education programs can be a huge barrier to getting education. Student loans can assist you with paying these fees, so you can pay for school while still paying other bills. 

If you apply for student loans, the government may instead give you a grant. When you request a certain amount of money for schooling, the student aid organization may award part of that amount of money as a grant, which is funds you don’t have to repay! 

Student loans in Canada often have low interest rates. Interest rates for student loan repayment are often single digits, and Canada Student Loans temporary have an interest rate of 0%. 

You do not have to pay back a Canada or Alberta Student Loan during full-time studies. Neither the federal nor provincial governments require repayment for the six months following your full-time studies. For six months after full-time studies, you may focus on other priorities like finding a job, without payments being due or interest accumulating.  

Your credit rating improves if you make payments on time. If the loan organization receives your money on time regularly, you will improve your credit rating. This may make it easier for you to be approved for other forms of credit, like a credit card or a mortgage. 

If you want to know more about the credit rating, please check out our On Demand Credit workshop. 

There are two ways for the organization to receive payments on time: either you pay the monthly amount on the date it is due, or you allow the organization (Alberta Student Aid or National Student Loans Service Centre) to withdrawal the payments from your bank account each month. Either way, the Judi Slot Online is getting your payments on time, and your credit rating improves.  

You may be eligible for student loan forgiveness and repayment assistance. If you are having trouble making payments, you can apply for government assistance to repay the loan, or loan forgiveness. These options reduce the amount that you have to repay.  

But wait! Before you apply for a student loan, consider the following risks of student loans. 


Cons of Student Loans 

Student loans generally must be paid back. Unfortunately, student loan money won’t be yours forever, and the lending organization will usually be expecting repayment. The student loan will be an expense to pay as well as any usual bills, until the loan is paid for.  

If you miss a payment, your credit score may get worse. If you miss student loan payments, it will negatively affect your score as a borrower. If you miss one payment, that may not entirely destroy your credit rating, but you still may want to be careful about how much money you request for a loan. Keep track of your income and expenses, so that you know how much money you will have available each month to repay a student loan. 

If you know how much money you will need borrow, you can calculate at this site how much will be due each month, so that you can find out whether you will have enough money to repay the loan when payments are due.


For more information about student loans, visit the website for Alberta or Canada student loans: 

Alberta Student Aid: https://studentaid.alberta.ca/ 

National Student Loan Service Centre: https://www.csnpe-nslsc.canada.ca/en/home 

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