ABCS OF FINANCE - Atlantic Business Magazine

ABCS OF FINANCE - Atlantic Business Magazine








By Alec Bruce

Tom Hamza is unequivocal about

the cost of a university or college

degree, especially in Atlantic Canada,

where tuitions tend to be higher than in

other parts of the country. “The fact is

people are now expecting to gradauate

with $20,000 or $30,000 worth of debt,”

says the president of the Ontario-based

Investor Education Fund. “If you don’t

do sound planning, then this becomes

a burden. But it’s not a burden. It’s like a

mortgage. It’s a part of life.”

Indeed, it’s a part of life with which

students in schools across the land have

become wincingly familiar. Some estimates

peg total student debt in Canada at more

than $15 billion. And, according to the

Canadian Federation of Students’ website,

“for more than a decade, students studying

in the Maritimes have had the highest average

debt loads… The Maritime Provinces Higher

Education Commission… reports that student

debt skyrocketed between 1999 and 2004, from

$21,177 to over $28,000 – an increase of more

than 33 per cent in just five years.”

What’s more, “Among those who have never

participated in post-secondary education, ‘financial

issues’ have been found by researchers to be the

most commonly cited barrier.

“Meanwhile, for those who are enrolled

in higher education, apprehension about

accumulating debt can… have a profound impact

on the likelihood of completion. As many

students work part- or full-time to reduce their

borrowing, academic commitments can become

more difficult to fulfill. Other students simply

leave before completion at the first offer of decent

employment as a way to stop accumulating debt.”

Online extras: | 95


Tips on how you can get

yours (scholarship, that is)

Are you interested in exploring other cultures,

have one year of studying under your belt, are

majoring in modern languages with a 2.09 GPA and

a demonstrated interest in the community through

participation and volunteer roles and are from Canada,

preferably Atlantic Canada, and are in demonstrable

financial need?

If so, there’s money awaiting you.

Matching your background with available scholarships

isn’t always this easy. That’s why you should talk to

a professional like Michelle Fougere, the manager of

Financial Aid & Awards at Saint Mary’s University.

She oversees the awarding of hundreds of scholarships

each year. Some are straightforward: you need a certain

academic standing, or to be in financial need. But others

are more specific. “It really helps to touch base,” she says.

For example, Fougere handed out a $2,200 scholarship

to a single parent who met the criteria. But the student

wasn’t able to enroll come September. Fougere didn’t

have time for another full contest. She thought of another

eligible candidate and gave her a big cheque. “She was

thrilled,” she says.

Her advice? Sit down with your campus awards person

and tell them all about yourself. The strangest things

may qualify you for a scholarship, so the more you know,

the better.

Next, go online. Fougere recommends Studentawards.

com. Plug in your info; it helps identify your scholarship

eligibility. is another good spot (Google “AUCC”

and “scholarships” to get right to the page), as it handles

many corporate awards from the Irvings of the world.

Ask your parents and grandparents. Not for a personal

scholarship, but for a workplace one. Many employers

have scholarships for children and grandchildren, which

often go unclaimed. Google the company yourself, or ask

your family to ask around.

Community groups like the Lions’ Club, Junior

Achievement and Big Brother-Big Sister also hand out

scholarships, and you’ll only get it if you ask for it. Ask

your professors. Follow your award centre online. Look at

bulletin boards.

“The difficulty is it takes time, but it’s a good return

on that investment if you’re successful,” Fougere notes.

To apply, you often need a personal statement

96 | Atlantic Business Magazine | November/December 2013

describing you in your full glory. Go to

the campus writing centre for help. It’s

not about bragging, but about making

it easy for the scholarship trust to see

you’re the best candidate.

If you’re studying the natural

sciences (biology, chemistry, physics)

or engineering, touch base with the

Natural Sciences and Engineering

Research Council of Canada (NSERC).

It offers a variety of scholarships to

support undergraduates, graduate

students and postdoctoral fellows.

Many give students R&D work

experience in a company.

“Academic excellence is the main

criteria for the majority of scholarships

offered by NSERC so students must

achieve high grades and describe the

research they will be undertaking at

the graduate and post-doctoral level

in a convincing manner,” says Pamela

Moss, acting vice-president research

partnerships programs at NSERC.

If you strike out, check back in

September. There may be a $2,200

cheque waiting for you. —Jon Tattrie

all about level-headed, personal financial

planning. And sources of help have

never been more accessible. “Overall, the

attention on this issue has been increasing

steadily, over the past 20 years… The tools

to help students in university to manage

their finances are more numerous and

more available today than in the past,” he

says. “There are much better interfaces

and they allow you to have much more

detail… The big challenge is putting the

tools in the right hands.”

His own organization is a case in

point. According to its website, “The

Investor Education Fund develops

and promotes unbiased, independent

financial information, programs and

tools to help consumers make better

financial and investing decisions. It was

established as a non-profit organization

by the Ontario Securities Commission

and is funded by settlements and fines

from OSC enforcement proceedings.”

Says Hamza: “About five years ago we

would have about 190,000 people using

our content, and last year, we were just

under two million… For both students

and adults (non-students), we provide


Memorial@what works.





Cont’d from page 95

In fact, the effects on the broader

economy can be palpable. “The pursuit

of higher knowledge may be noble, but

it is also sinking Canadian post-graduate

students in debt and delaying major

life milestones, suggests a new poll,”

the Huffington Post Canada reported

in July. “Research from TD Canada

Trust suggests 30 per cent of post-grad

students—those who pursue Master’s

degrees, PhDs or other degrees after their

undergraduate years—accumulate more

debt than they had expected. About 40

per cent said they find it difficult to meet

minimum repayments on student loans

in their first two years after graduating…

The still struggling post-recession job

market has been particularly tough on

young people and many find it difficult

to find well-paying jobs in their fields.

Canada’s youth unemployment rate sits

at about 13.8 per cent, about double the

national average.”

All of which may be the unavoidable

consequences of post-secondary life in

the breaking years of the 21st Century.

But Hamza is one among many who

believes that these consequences need

not be crushing. As with everything else

worthwhile (buying a house, a car, RRSPs),

obtaining a university or college degree is




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Online extras: | 97

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information that you might not get from

the industry in particular, which tells

you much of the story, but not always

the whole story. So we are here to be the

customer’s advocate when it comes to

financial matters.”

Although Hamza allows that a certain

percentage of the student population

will embrace their personal finances

early and with gusto, a sizable chunk

simply won’t. These are the individuals

who need to be “hooked” before their

disinterest (or fear) forces them into an

uncomfortable bind.

“There are a couple of structural

things you really need to get your

head around when you are looking at

potentially assuming some major debt.”

he says. “The first one is acceptance and,

after acceptance, developing a plan. It’s

a fairly overused axiom, but this is, after

all, an investment. The whole thing

needs to be much more about planning

and addressing facts of the plan and far

less about the fear of that debt that is


Related to this is developing a degree

of financial literacy. Lamentably, he says,

“none of the Maritime provinces and only

a couple of provinces elsewhere in Canada

teach this stuff in school… They don’t teach

basic financial education, including values

and percentages, understanding inflation

rates, understanding accumulated and

compounded growth. Getting a basic

understanding of these things, including

the accumulation of debt and also the

paying down of debt is critical to developing

the long-term plan.”

As for the basics, Investor Education

Fund sets out an easy-to-follow series

of guidelines that should be familiar

to anyone who has had to function

with fixed or limited resources. These

include: how to save money to pay for

the cost of education; budgeting to make

school funds last over the academic

year; managing student debt to prevent

it from wheeling out of control; the dos

and don’ts of using credit cards; how to

avoid frauds and scams; and making the

most of tax deductions.

As the website stipulates, “if you’re

a student, you are in a very different

place than someone just starting out in

the workforce. You have not yet started

making real money. You are focused more

on your studies. And, of course, you want

to have fun. However, it is important to

take your money choices seriously.”

The bottom line, Hamza says, is that

none of this is a disaster: “It just needs

a plan.” | ABM

98 | Atlantic Business Magazine | November/December 2013

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