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Endless Loan: Early childhood teacher Sammy Attwell is still paying off her $29,000 student loan.

The Western Bay’s student loan debt grew by more than $200 million in the last five years – and experts say the debt will have huge consequences for students.

Inland Revenue figures show The Western Bay of Plenty’s student loan debt rose more than $200 million over the past five years, to $672 million at June 30.

University of Auckland sociology professor Alan France said the student debt would cause financial and social effects.

“There’s lots of long-term evidence that shows you will earn more money if you go to university than if you don’t, but these days that pay off takes five to 10 years,” Mr France said.

“Most people now go in to low-skilled, low-paid jobs which are insecure when they leave university, so they wind up fighting large student debts on low incomes from jobs which don’t have a great deal of long-term future prospects. Buying houses is out of the question for many young people, while having children can be a risk in terms of their financial futures.”

Early childhood teacher Sammy Attwell of Matua stacked up a $29,000 loan while studying.

Ms Attwell works as a relief teacher, meaning each weekly pay was different from the rest.

Student loan repayments were usually deducted directly from salary or wages.

“Once you look at how much you lose to tax as well you really feel the pinch,” Ms Attwell said.

Ms Attwell estimated her loan would take six to seven years to completely pay off.

“It’s a bit daunting,” she said.

She had paid off about $4000 over the past two years and said her loan would make it “a lot harder to save for a house”.

Tauranga Budget Advisory Service co-ordinator Diane Bruin said it was common for students to have large loans.

“That’s going to continue and only get worse,” Ms Bruin said.

“People have really got to reduce [the debt] before they can think about getting into home ownership and using their KiwiSaver”.

However Ms Attwell said the fact her student loan was interest-free “was a massive blessing”, as she would be able to pay it off quicker.

Bay of Plenty MP Todd Muller said growth in student loan debt was due to more students studying and a shift to a higher level of study which incurred higher fees.

“The temporary cost of having a student loan is far outweighed by the ongoing benefits. The median earnings of young people who complete a bachelor’s degree are 46 per cent above the national median earnings five years after finishing study,” Mr Muller said.

“We also know students who remain in New Zealand after study are on average projected to pay off their student loans less than six years after they complete their study.”

Central North Island Young National chairman Jason Howarth said the members of the group with student loans viewed it “as an investment in their future through education and is part of the pathway to a career and to achieving high wages”.

“Recently the Bay of Plenty was named as one of the fastest-growing regions, this has a follow-on effect of more people enrolling in tertiary education and a higher demand regionally for tertiary-educated people.”

Tips for paying back your student loan

You can pay back more than the minimum repayment amount at any time. However, if your loan is interest-free, you won’t get any further into debt by paying only the minimum.

If you want to pay off your loan faster, you can make extra repayments whenever you want to. You can pay Inland Revenue directly or ask your employer to make extra deductions from your salary or wages.

You can work out how how long it will take you to repay the loan and the difference voluntary repayments could make with online student loan calculators, available at


If you’re a student and need help planning you’re finances for next year, come along to our free clinic at the Bongard Centre, BOP Polytechnic on Wednesdays 3pm to 6pm.  Contact details (including a mobile number to text) can be found here.