Read the latest

Access insights and articles to help you navigate the world of education and investments.

It should not come as a surprise that university education is expensive. But the lesser known fact is that the cost of a university degree can negatively impact other life decisions such as purchasing a home, a car, or even medical treatment years after graduation. This is a reality that Futurity’s Impact of University Debt Report has uncovered.

Impact of uni debt on other life decisions

The Report has revealed the financial and social cost of a university education on many Australians.

  • 50% of those surveyed said that their HECS-HELP debt has made an impact on other life decisions such as purchasing a home
  • 41% said it had some impact on their ability to buy a car
  • 30% said they could not afford medical or dental treatment, sometimes years after graduating
  • 28% of respondents reported that their HECS-HELP debt affected their decision to start a family
  • 24% reported a moderate to very large impact on their ability to start personal investing outside of superannuation
  • 18% regularly go without food and other necessities
  • One in five said that it had a moderate to very large impact on their ability to start a business
  • One in four said they were worried about their financial situation
  • Respondents said HECS-HELP debt also had a moderate to very large impact on their ability to pursue a different career.

As many as 1,000 Australians who attended university were surveyed for the one-of-a-kind Report, the purpose of which was to measure the social and financial impacts of debt acquired at university.


3 million Australians have a HECS-HELP debt


Findings also matched data drawn from the Australian Bureau of Statistics, which reports that approximately 3 million Australians have a HECS-HELP debt totalling $67 billion. HECS-HELP provides eligible students with a loan to pay their student contribution for a Commonwealth-supported place in their chosen course.


The latest reports, derived in 2018/19, show that the average time to fully repay HECS-HELP debt was 9.2 years, gradually trended up from 7.3 years over the past 15 years. Since 1989, 1.8 million Australians have fully repaid their HECS-HELP debt. Approximately 2 million have not made any repayments.


The Impact of University Debt Report found that 72% of respondents who attended university have a HECS-HELP debt in their thirties, and that 48% of respondents aged 22-29 finish university with a HECS-HELP debt of between $20,000 and $50,000. But this does not and should not deter one from pursuing a tertiary education.


Read the full Impact of University Debt Report.


Student debt not a deterrent to tertiary education


Despite the impact of university debt on their lifestyle, a majority (56%) of respondents are positive or neutral about the value of their university education because of HECS-HELP debt. Indeed, aversion to debt should not provide a barrier to student enrolment in tertiary education.


Whilst Super Guarantee rate gradually increasing from the current 9.5% to 12% is an important step forward for retirement savings, the increase may mean the less overall available cash at hand for individuals, which may further impact the lifestyles of those with university debt.


A higher education is an investment you make for the future, as research consistently shows that a university degree is worth the cost. On average, uni graduates earn far more over the course of their professional career than peers who didn’t get a university degree.


Over the years, academics and policymakers have suggested various options to help students, including letting working graduates claim a tax deduction for their HECS-HELP debt or having shared interest or a universal loan fee (of around 15%) for HELP. While these options continue to be discussed, the best way to offset a massive student debt is to be aware of the inevitable cost of a tertiary education and to plan for it early.


Offset student debt by saving for education


Those surveyed for the Impact of University Debt Report said, “Students should be made aware of the interest rate applied to the debt when they first sign up for a HECS-HELP loan,” and expressed sentiments such as, “Make the student aware of the total cost and how it will be repaid.”


Find out how to calculate your HELP debt.


Futurity CEO Ross Higgins said, “Debt acquired at university should not negatively impact important financial and social objectives. With the cost of university education exceeding $50,000 in many instances, it’s essential young people considering a tertiary education understand that debt acquired at university can carry financial and social burdens later in life, and pay for university education without it impacting their financial wellbeing and ability to achieve their goals later in life.”


Futurity’s ground-breaking range of Education Bonds allow parents and grandparents to tax-effectively save and invest to accumulate the funding to support their whole family’s education objectives.


Find out more about Futurity’s Education Bonds.