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How to help students cope with their loan
Tamara MadernNibud
04-10-2010
Nibud
Independent expert centerOnly subject: household finances
Our aims:
• Increase consumer’s welfare
• Prevent overindebtedness
Why is money management so difficult?
• More and more responsibilities
• Finance is getting more and more complicated
• Influence commerce is growing
• To keep an overview on your finances isn’t easy
Dutch loan system for students
• Performance related grant Basic & additional
• Ordinary loan
• Tuition fee loan
• Free travel
• Private loan
How to get a loan?
Just klick
Survey students
• Working Youth (2005) VET-students, working 4 days, 1 day of school
• Student research (2010)VET-students and higher education
Survey working adolescents
• 90% live with their parents• Minimum income
1 out of 3 has debts (€ 900)
When living on their own:2 out of 3 have debts (€ 1585)
Student research
Loan amount
Type Amount €
Public loan 10.211
Other loan 276
Overdrawn 414
Creditcard 1.437
The average Dutch student has a debt of €13.318 when he finish his study
Loan amount
Amount monthly €
Total debt€
Gender Male 415 11.469
Female 375 8.703
Level of education VET 255 5052
Higher 392 9.083
University 438 13.075
Age 18-21 307 4.973
22-25 448 12.151
26-29 582 18.300
Total Mean 396 10.217
Median 350 6.500
52
42
3838
27
24
19
915
Reason to borrow
My parents can't support me
I just don't have money
I will not burden my parents
I don't want to work
To relax
I don't get the basic public loan
Because of my internship I can't work
I need money for study abroad
Facts• 46 % has a debt, only 80% knows the
amount
• 44 % knows the interest rate
• 7% believes there’s no interest
Facts• 59% wish they had borrowed less
• 53% the loan is a burden
• 66% thinks that other students borrow to easy
Conclusion
Students don’t think before they borrow
They borrow for luxury!
Approach
Borrow money for study is not a bad thing, but know what you are doing!
Broad approach necessary
• Parents
• Education
• DUO
• Government
• Banks
Nibud competences 19 – 23 years
• Balance income, expenditure, assets and debts.
• Shop consciously, ensuring that purchasing patterns fit in with budget, wishes and possibilities.
• Pro-actively keep administration up-to-date.
• Ensure their income is sufficient.
Nibud 2009
Nibud competences 19 – 23 years
• Consciously save and borrow.
• Avoid problematic debts.
• Take out appropriate insurance.
• Adjust finances according to changes in circumstances or lifecycle.
Nibud 2009
Study loan guide