Axing Loan Interest Will Help Indebted Teachers
Axing Interest On Student Loans Will Help Indebted Teachers
Teachers with students loans are delighted with today’s announcement by the Prime Minister that Labour, if re-elected, will scrap interest on student loans from April 1 next year for graduates living in New Zealand.
applauds this bold step to reduce the burden of student debt
on new teachers and on
people studying to become teachers,” says NZEI Te Riu Roa National President, Colin Tarr.
A survey of 841 teachers in their first and second year of teaching showed that 85% had student loans when they graduated and their average student loan debt was $16, 305.
The survey, “Teachers in Debt: A Report Card,” was conducted by the NZUSA (New Zealand University Students Association) and NZEI Te Riu Roa and was released on April 27 this year.
A third of the new teachers surveyed said they planned to leave New Zealand after three years of teaching and that their student debt was the number one reason they were leaving the country to work overseas.
“Scrapping interest on student loans has got to be good news for our new teachers who are have an average student loan debt of just over $16,000,” says Colin Tarr.
“This will enable them to pay off their debt far more quickly and should mean more new teachers stay in New Zealand, rather than heading overseas, as they do now to pay of their debt.”
“Axing student loan interest will also make it easier for people to study to become teachers,” says Colin Tarr.
The NZUSA/NZEI survey shows that 70% of new teachers worked an average of 15.4 hours a week in part time jobs while studying, while more than half worked between 15 to 30 hours a week. Sixty per cent said this had an impact on their study.
Not having to pay interest on student loans will also make it easier for teachers with loans to buy their own homes and save for their future. Seventy one per cent of the new teachers surveyed said that their student loans made it difficult to save for their futures and that saving to buy a home was the major problem. A fifth said having a student loan made it difficult to borrow money for things like buying a home.