2022 Federal budget update offers more student loan repayment assistance.

The 2022 Federal budget update proposes the following assistance for the repayment of student loans:

Loan forgiveness for family doctors and nurses:
Starting in 2023, nurses may qualify for up to $30,000 in student loan forgiveness and doctors up to $60,000 in student loan forgiveness provided they work in rural communities.  In the coming year, the Federal government will be looking to expand the list of eligible professionals for this program and review how rural communities are defined.

Suspension of interest:
Currently, until March 31, 2023, no interest will be charged on Canada Student Loans and Canada Apprentice Loans, however, both the Federal and New Brunswick governments have proposed making these loans interest free on a permanent basis.

Student grant supports:
Full-time students with a financial need and income below government thresholds may qualify for a grant for each month of study.  The government has extended doubling the maximum amount of Canada student grants until the end of July 2023 and students are able to use current year income rather than prior year income to determine eligibility.  You are automatically assessed for grant eligibility when you apply for student aid with your province or territory.

Easier access to repayment assistance:
If approved upon application for the student loan repayment assistance plan, a person living alone will no longer be required to make payments on their student loans if they earn less than $40,000 gross income per year.  This amount increases based on family size.  If income is higher whereby payments are required, maximum payments have been lowered from 20 percent to 10 percent of household income.

Expanding support for borrowers with disabilities:
As of the 2022 to 2023 school year, support has expanded to include people who have persistent or prolonged disabilities. This adds to support already in place for people with lifelong, permanent disabilities.

Skills Boost program:
This program has been extended until July 2023 and it provides a top-up on the Canada Student Grant for full-time students.  The Skills Boost program along with the Canada Student Grant help working adults afford the cost of returning to school full-time to upgrade their skills by helping to offset income lost as a result of returning to school.  Applicants are automatically assessed for this benefit upon applying for a Canada Student Loan.

You can visit canada.ca for more information regarding the 2022 Budget as well as matters specific to student loans and other forms of student aid.  The site also has a “Student Aid Estimator” to help determine what kind of aid an applicant might qualify for specific to their current income and family situation. 

What if you already have student loans you cannot repay regardless of whether interest is waived?
If you have been out of school for seven years or longer, a bankruptcy or a consumer proposal could help as both will stop collection and/or legal action and eliminate student loan debt.

If you are struggling with student loan or other debt, please do not hesitate to contact our office for a free consultation to explore your options.

If you are looking for advice, or a second opinion about your debt, it does not cost anything to talk about your options. Every financial situation is unique and viable options can differ from person to person.  A conversation free of judgment, is the first step to determine options for debt that make sense for you.  For a free consultation, please call or text (506) 645-1814 or email jaime@tackledebt.ca; or visit www.tackledebt.ca.