Student debt has been on the rise for some time now.
Between 1999 and 2023, the average debt of post-secondary students who borrowed to pay for their studies rose from $17,600 to $20,400 (adjusted for inflation), while the total student debt held by Canadian households ballooned from $25.3 billion to $41.2 billion (adjusted for inflation).
Student debt has also become more widely accepted as the norm.
Statistics Canada’s data shows that high-income parents are saving ever more aggressively for their children’s education, while a recent public opinion survey found that 53 per cent of post-secondary students believe “graduating with debt is part of the student experience.”
While struggling to pay for post-secondary education and training is often portrayed as a noble sacrifice, the reality is that high tuition fees and the resulting student debt constitute a massive wealth transfer. They shift the cost of workforce training onto working families, whose skilled hands and minds make Canada (and its corporations) rich.
High tuition fees and reliance on loans also prevent many from accessing or even considering post-secondary education and training. For people struggling financially, education costs are often out of reach, and debt financing is risky given low and volatile incomes. As a result, people’s potentialis often wasted or underutilized.
Post-secondary education and training is a strategic, nation-building investment that should be paid for with tax revenues.
Using the best available data, this report paints a picture of the impact of this wealth transfer: financial insecurity for indebted households of all ages, and a growing wealth gap between low-income households burdened by bad debt and higher-income households building wealth and financial security.
Who has student debt?
According to the 2023 Survey of Financial Security (SFS), 12.1 per cent of Canadian households carry student debt. This percentage varies by region. British Columbia (8.9 per cent) and Quebec (9.6 per cent) are below the national average, Ontario (13.9 per cent) and the Prairies (14 per cent) are above it, while the Atlantic region is close to the average.
Debt burden is not evenly distributed. Across Canada, racialized families are more than twice as likely as non-racialized families to have student debt. The reasons for this discrepancy vary. It is, however, clear that the impact of higher tuition fees and weaker student aid programs will be felt more strongly among families that have historically been underrepresented in higher education and high-paying jobs.
Regarding age breakdowns, households with a main income earner aged 35 or younger are 2.2 times more likely to carry student debt, as expected. That said, in only 42.2 per cent of households with debt, the primary income earner is under 35; in 42.1 per cent of households with debt, they are between 35 and 54; and in 16 per cent, they are aged 55 or older. The large share of households in the 35 to 54 category is due to this group including older adults who are still paying off their student debt, households with students living with their parents, and households where both parents and their children have debt.
The takeaway from these age breakdowns is that, although younger people are more likely to have student debt, this is not only a young person’s problem. The financial burden of student debt spreads across families with varied age compositions.
Households with student debt face greater financial challenges
High-income earners often borrow to invest and build wealth, so not all debt is tied to everyday financial difficulties. However, student debt is. As shown below, families with student debt are more likely to miss bill payments, borrow from payday lenders, and live paycheque to paycheque. They’re not building wealth; they’re falling behind.
Student debt versus mortgage debt
Some debt is part of a wealth-building strategy, like a mortgage on a house whose value is expected to rise above inflation. Some debt is outright bad, like a missed credit card payment that accrues high interest. Student debt is not as bad as a credit card balance since post-secondary training is associated with greater opportunities and higher incomes, but it is not a straightforward wealth-building strategy either.
Student debt is a burden that thwarts the financial security of families of all age compositions. Families in the bottom 40 per cent of the wealth distribution carry a disproportionate share of that burden—63 per cent of all student debt.
Meanwhile, families in the top 20 per cent are heavily invested in real estate, which, because of the regrettable financialization of the sector, is the main wealth-building strategy in Canada.
There is no nation building without post-secondary education and training
The past couple of years in Canadian politics have seen the re-emergence of terms like nation building, industrial policy, and generational investments—popularized by slogans like Elbows Up and Buy Canadian. Oddly, post-secondary education and training has not been part of this conversation.
Provincial governments are raising tuition fees while cutting back on financial aid, turning post-secondary education into a privilege for children of wealthy parents or a lifelong debt sentence for others. At the household level, this approach worsens the financial insecurity documented above. At the aggregate level, it will weaken Canada’s economy as workers of all ages postpone or forgo further training, ultimately exacerbating inequality. It’s an extremely short-sighted approach, even from the most fiscally conservative perspective.
The federal government is doing very little—or practically nothing—to address this situation. In March 2026, it announced changes to the Canada Student Financial Assistance (CSFA) program that allow students to receive up to 40 per cent of their aid as grants and borrow up to $300 per week of study. While ultimately insufficient given the scale of the crisis, these changes should have been made permanent once and for all. Instead, the federal government is making piecemeal concessions while failing to address the key problem driving unaffordability: high tuition fees.
Despite all the talk of nation building and generational investments, the federal and provincial governments are failing to invest in the most important factors of production: labour.
Debt does not have to be an inevitable part of the student experience. It is the result of short-sighted policies that limit funding and access to post-secondary education and training, thwarting the country’s ability to reach its full social and economic potential and reinforcing the divide between those for whom debt is part of the student experience, and those who had the foresight to choose wealthy parents.
The CCPA would like to thank the National Union of Public and General Employees (NUPGE) for supporting this research.
