Should I pay back my New Zealand Student Loan?

I dropped out of high school at 17 and went to MIT. Not that one. The one in New Zealand that shares the same name as the world renowned college in Boston. There’s looks like this

ours looks like this:

 

The course I studied was light fabrication engineering. It was FREE for anyone of maori or pacific island heritage. Draw what conclusions you want from that. The most obvious one is that it was a hand out from the government to get more brown people studying a trade subject.

The Aucklander

Although I was born in Auckland, I spent the years between 9-17 in Northland. Returning to Auckland was good for someone that wanted to live in a big city. I had a few friends living in Auckland going to Universities. I’d spend most weekends with them in the city doing what young teenagers do best. The problem was, I was always broke. At the time, the government was giving out allowances. Which was great. However I was going out partying, so that was bad because the allowance was only $150 per week. My rent was free because I lived with my aunt, she also paid for all the food in the house and covered all the utility bills too. I think she even washed and dryed my clothes. I was spoilt. Young, dumb and spoilt.

The Influence

I overheard a few guys in my course one day that went on the weekend. Talking about how many bottles of champagne they had at their table. Not to mention the females that were sitting with them. Sounded like a great night out, the kind of night I could only dream about as I was broke. These boys were in the same boat as me, Pacific Island boys from South Auckland. Living in a modest house, wearing flee market cloths, driving a shit car. So I approached my Samoan uso’s and asked ‘must of been an expensive night’? and they said ‘not really, we just used our loan money’

The Borrower

In 1997 the New Zealand government was handing out money to anyone who was a student. That probably isn’t a fact. But I made it so, because it was so easy to get money. All I had to do was, call a 0800 number, speak to some guy. Tell him I needed $500 for equipment, suppliers or something for my course. 24 hours later it was in my account. Boom just like that I was down Queen St. with all the other students. Buying rounds of drinks. I even went on a cloths shopping spree and bought a new skate board while I was at it.

The Boy racer

The biggest purchase was a car. I already had a car. But it was a pile of shit. 1981 Datsun 200b, worst part was it was brown, like a poo brown like the photo below. But worse!

So why not buy another one?.  The car of choice for the entry level Auckland boy racer was the Mazda 323 DOHC Turbo hatch back

What more could a boy need? New clothes, skateboard, nights out with the boys, girls. I was living the dream. All on the expense of the New Zealand tax payer.

The Debt

I managed to irresponsibly rack up $4,000 NZD of debts in the year I as studying at MIT, with absolutely no intention of paying it back! What do you expect from someone like me who didn’t value money? That thought money grew on trees and that ‘it will sort itself out’?.

The Aftermath

After I graduated from MIT, I landed a job in the auto industry doing nothing related to the fabrication. All the effort to pass my exams got me nowhere in the real world of welding or manufacturing. Still I had a great time. From the age of 18 I also didn’t have the loan deducted from my pay, that would have been the clever thing to do. Instead I stuck my head in the sand as far as I could in the hope that it will just ‘go away’.

The Payback

IRD were sending my parents notices every month/year and every time I told them throw them away. The first time I opened on was in 2012 when I was back for our wedding. I wasn’t exactly shocked at the amount as I knew that the interest accumulated over 15 years would have been significant.

So let’s just take a step back

1 year of study that was free of charge cost me $35,410.44 NZD!

1 year of ‘living the dream’ and driving a fast car, going out partying and not getting a degree cost me $35k!

I remember standing in my old bedroom with my the woman who had just become my wife, whilst I read out the number on my student loan statement. In fact it was her that pushed me to begin paying the debt back. It was her that told me to contact IRD and ‘sort this shit out’. I thank her for many things and one of them is making me see the error of my ways.

After 3 years and many conversations with the IRD, I can proudly say that I’ve shaved $15k off that amount and if I keep this up I’ll be debt free in just in a little over a year.

If I was given the opportunity to go back and do it all again, I wouldn’t change a thing. I had a good time on the expense of the tax payer, I learned to value money and the importance of being responsible. Besides its lessons like these that make us stronger isn’t it? and of course I can tell this story to my kids if and when they want to get themselves into debt

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Nicholas Manarangi

After 10 years away Nick and his family are returning to New Zealand. Leaving their busy London lives behind and exchanging it for new challenges in Auckland. Motivated by family and a change in lifestyle.

Nick's Dutch wife is mostly concerned about the quality of NZ chocolate and cheese.Hope we don't disappoint.
connect here

Nicholas Manarangi

After 10 years away Nick and his family are returning to New Zealand. Leaving their busy London lives behind and exchanging it for new challenges in Auckland. Motivated by family and a change in lifestyle. Nick's Dutch wife is mostly concerned about the quality of NZ chocolate and cheese. Hope we don't disappoint.