Take Advantage of Student Loans and Scholarships to Reduce Tuition Debt

Friday, April 1, 2016


grad-cap-and-moneyThese days, post-secondary students have more than heavy workloads to worry about—they’re also faced with the challenge of paying hefty tuition fees. Unfortunately, expensive tuition often leads to crippling debt for new graduates. So, how can students prevent incurring more debt than necessary? They can seek out financial aid.



Financial aid is available in many forms including loans, scholarships, bursaries and grants, to name a few. Each type of financial aid offers its own set of unique benefits and drawbacks.


Students in need of financial assistance can secure loans from a few different sources:

  • Student Aid Loans: The Canadian Government offers Canada Student Loans to eligible full-time and part-time post-secondary students. There are also provincial organizations like Student Aid Alberta that offers assistance in the form of loans and grants. Eligibility for these kinds of loans is typically assessed based on demonstrated financial need, course load, cost of living, tuition costs, etc.
  • Bank Loans: Students who don’t qualify for loans from financial assistance programs but still need some support can opt for a loan or line of credit from their bank.

The difference between student aid loans and bank loans is that the interest on bank loans starts to accrue from the day the money is accessed and you are required to make interest payments while you are still in school. Student loans, on the other hand, don’t start accumulating interest or require payments until after you’ve graduated.

Applying for Student Aid Loans

If you’re a post-secondary student in need of financial assistance, a loan is a good place to start. To find out if you are eligible for a student aid loan, click here. Once you determine that you’re an eligible candidate, you’ll need to fill out a Canada Student Loan and Grant application form. These forms are available in paper form at your high school, at your provincial financial assistance office or online through the student financial assistance website for your province.

After you have filled out and submitted your application form, you will receive a Notice of Assessment in your mail or email (depending on how you submitted your application). This notice will include a Master Student Financial Assistance Agreement (MSFAA) that will inform you whether or not your application has been approved and provide the value of the loan you will receive. It’s important that you review the information in this agreement carefully—it’s a legally binding contract, after all. Once you’ve reviewed your MSFAA, you’ll need to confirm enrolment with your school, sign and submit your agreement. Get more detailed information on submitting your loan documents here.

A quick side note about loans: In order to reduce the amount of interest paid out, students should start paying off their debt as soon as possible. Any payments made while students are still in school or during their 6-month non-repayment period will be applied directly to the principal of their loan instead of going towards repaying interest. Another way to prevent interest from building up is to increase monthly payments. Increasing payments by as little as $50 a month can have a huge effect on the amount of interest you’ll pay in the long run. Read more tips on managing student loans.1,2

Other Types of Financial Aid

  • Grants: When students apply for a Canada Student Loan, they are automatically considered for a wide variety of Canada Student Grants. Grants can be given out based on financial need, academic performance or to assist in carrying out academic research. The main difference between loans and grants is that grants do not need to be paid back. Another upside? Depending on their situation, students may be eligible to receive more than one grant.2
  • Bursaries: A bursary is very similar to a grant in that it does not need to be paid back. Usually, bursaries are offered by universities, colleges or charities (as opposed to government agencies), and are dependent on certain criteria—mainly financial need.3
  • Scholarships: A scholarship is awarded based on academic performance, special merit, or demonstrated excellence in a certain area (i.e. music, athletics or volunteering). Like grants and bursaries, scholarships do not need to be repaid. One drawback of scholarships is that the application process can be more involved. For example, some scholarship applications might require students to write an essay, provide detailed information or submit a video.

Scholarships for Students in Alberta

There are plenty of scholarships and bursaries out there for post-secondary students in Alberta—you just need to know where to look for them. A good place to start is Student Aid Alberta - a great resource with tons of information about what scholarships and bursaries are available. 4

Applying for Scholarships/Bursaries/Grants

If you’re a post-secondary student and you’re interested in applying for a scholarship, make sure you do your research. There are hundreds of scholarships—you just need to choose the ones that you are best qualified for. It’s also important to ensure that you are an eligible recipient so whatever you do, read the fine print!

Give yourself plenty of time to complete your application to make sure you don’t rush and make a mistake. If there is an essay involved, have at least two other people proofread it before submitting your application—you don’t want a simple spelling error costing you the scholarship.

If you ever start to feel overwhelmed during the application process, take a minute to remember why you’re applying in the first place. If your hard work leads to even one scholarship, it will have paid off. Trust us—you’ll be glad you did in the future when you’re not struggling to pay off student debt.

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