Graduate student finance: an analysis of debt and funding Grad students are working and paying off loans, but still in debt

This article is about a four-letter word that says so much with so little. A four-letter word that everyone has felt in some way. A four-letter word that some only speak in whispers…debt.

As Canadians we are proud to be modest, however still enjoy to gloat every once and while about being first on the international stage. For instance, hockey comes to mind, or pop stars (depending on your taste in music), but according to a report by the Parliamentary Budget Officer released in January, we are also number one on the international stage for household debt amongst G7 countries. Awkward.

Debt has become a pervasive issue among Canadians. For many years Statistics Canada has tracked Canadians’ debt-to-income ratio as a measure that shows how much Canadians owe and the ability for them to pay it off. According to data from the third quarter of 2015, Canadians are in the danger zone of 171 per cent. Essentially this means that for every $100 of disposable income the average Canadian makes, they are spending $171.

Debt is an issue that students know all too well. A 2014 Statistics Canada report showed that over 50 per cent of undergraduate students relied on loans to finance their degrees, along with 44 per cent of master’s and 41 per cent of PhD candidates. In raw numbers students with bachelor’s and master’s degrees had $26,000 of student debt, while doctorate graduates had $41,000 on average.

You might be saying to yourself, so what? If I land a high-paying position then it does not matter what debt levels I have while obtaining my post-secondary education. This is sound logic, but the report shows that three years after graduation only one-third of bachelor’s and PhD graduates (and less than half of master’s graduates) had paid off their student loans.

Although, who cares what the national trends are? This is a paper for graduate students attending the University of Manitoba. Don’t fret – let’s take a look at the Canadian Graduate and Professional Student Survey administered to U of M students in 2013.

Table 1. Graduate students’ self-reported data on debt, work, and finance commitments. Source: Manitoba Canadian Graduate and Professional Student Survey, 2013.
Measure Description Master’s without thesis Master’s with thesis Doctoral
Percentage of graduate students with some form of student debt from their undergraduate degree 30% 30% 25%
Percentage of graduate students with some form of student debt from their graduate studies 52% 44% 42%
Percentage of graduate students using loans, savings, or family assistance 54% 34% 25%
Percentage of students that work off campus 36% 24% 20%
Percentage of students that work on or off campus as a research assistant or teacher assistant 18.4% 75.8% 99.5%
Percentage that report work/financial commitments are an obstacle to their academic progress 82% 76% 72%

Using the numbers in Table 1, two trends are apparent: first, graduate students are paying down their debt as they progress through their academic career; second, work and financial commitments become gradually less cumbersome for graduate students.

Additionally, graduate students are less likely to use loans, savings, or family assistance to pay for their graduate studies as they progress. This may be explained by the fact they are able to find either research or teaching assistantships.

Overall it appears that graduate students are financially responsible individuals who are covering the costs of their education with funding and assistantships. At the same time, graduate students are paying off their student debt during their studies.

However, Table 2 shows that finance and work issues are the largest obstacle to graduate students’ academic progress. At face value this seems to be at odds with the findings depicted in Table 1. Why are graduate students worried about work and finance being an obstacle to their academic progress, since the numbers in Table 1 show that graduate students are employed, funded, and paying down their debt?

Table 2. Percentage of students that believe the following factors are an obstacle to their academic progress. Source: Manitoba Canadian Graduate and Professional Student Survey, 2013.
Master’s without thesis Master’s with thesis Doctoral
Measure Description Minor Major Minor Major Minor Major
Work/financial 43.1% 38.2% 39.6% 36.1% 40.1% 31.6%
Family obligations 42.8% 24.6% 38.7% 18.3% 42.5% 18.1%
Availability of faculty 31.7% 5.5% 27.9% 7.7% 25.2% 8.7%
Program structure or requirements 46.7% 13.5% 37.6% 12.9% 38.2% 10.3%
Course scheduling 45.5% 16.1% 33.6% 10.0% 32.4% 7.8%
Immigration laws or regulations 3.5% 2.6% 10.5% 6.7% 17.6% 9.4%
Other 7.0% 23.9% 10.1% 36.2% 15.9% 50.0%

Based off the findings I would argue that graduate students are in general disciplined and capable of creating and sticking to a personal budget and managing any student loans they have. Consequently, if personal finance and loans are not a primary concern of graduate students it would only leave their internal and external funding opportunities as well as rising tuition fees.

Generally, funding opportunities are lacking, with more students applying for stagnant funding. This seems counterintuitive since universities have been steadily increasing tuition fees for decades. Between 1993-94 and 2015-16 tuition fees tripled for undergraduate students across Canada.

One of the reasons for tuition increases is because government funding as a share of universities’ operating revenue declined from 77 per cent to 55 per cent during this same period, according to a report by the Canadian Centre for Policy Alternatives. Tuition accounted for 20 per cent of universities’ operating budgets in 1992-93, but in 2011-12 the figure was over 37 per cent.

Continual tuition fee increases and stagnant grant opportunities are leading to higher student debt levels. Consequently, those surveyed at the U of M may be worried about a compounded problem of how to finance their education as it grows increasingly expensive.

Unfortunately, the U of M graduate student survey was not representative of the U of M graduate student body. Many departments and programs were drastically over- or under-represented in the survey, and a few had no students participating at all. Therefore, the survey results are descriptive, not inferential – the findings cannot be inferred to represent the U of M graduate population.

Even with an issue of representation, the national and U of M student survey results illuminate the financial issues facing graduate students that may be broken down into three categories: personal, student loans, and funding. The data could be better, but it seems to suggest that one area for improvement is in graduate funding.

Do you have thoughts or experiences on the subject of graduate student finance that you’d like to share? Drop me a line at

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