Students are adding more debt to their loans and are concerned about how it'll impact their futures. 

Studylink’s student loans provide cover for both student fees to study and weekly payments to go towards their living expenses. 

The amount of money students can loan for living expenses has increased by more than $100 a week over the past six years, according to Studylink's website.

On April 1, that amount will rise by just over $20 to $302 a week.

For students borrowing the maximum amount allowed, they're taking on more than $15,000 a year in living cost loans. 

New Zealand Union of Students Associations President Ellen Dixon said most students will take out the full amount while also working 30 to 40 hours a week to afford to keep studying. 

“I spoke to students in Wellington who say they only have $10 left a week for food, so it’s not pretty,” she said. 

Dixon claims that kind of lifestyle is unhealthy, as it means students can’t give their studies full attention.

She also fears young people aren't educated enough about the impacts of debt.

She said going from school to being “suddenly pushed into independence” is a big adjustment for students and there needs to be more conversations had around financial budgeting. 

"Most students use employment at the end of their studies as a comfort blanket and push student loans down to the bottom of their priority list", she said. 

“It (the way the system is set up) normalises a debt deficit mindset in education and education should never be associated with a debt deficit mindset,” she said.

The Green Party agrees. 

It claims university students need more than just “Band-Aid” solutions to the rising cost of living.

Tertiary Education spokesperson, Chloe Swarbrick said the party’s research showed two-thirds of students regularly can't afford the basics like rent, food, and power bills. 

Swarbrick believes adding more money to loans will only make it worse.

“Education is portrayed as a magical pathway out of poverty. But, in fact, the way that tertiary education is currently set up, it's actually a poverty trap,” she said.  

Ellen Dixon said students shouldn't have to choose between studying and buying a house. 

In the past, detailed breakdowns of applicants' spending habits acted as a barrier for first-home buyers getting mortgages approved. 

She fears we might see more of that for our next generation of students. Especially as they continue to use buy now pay later services like Afterpay to get by. 

One ANZ economist said an overall increase in average wages might be enough to meet rising student loans.

Miles Workman said although house prices are still not at an affordable rate, average wages are rising.

“Students may find themselves having to borrow more today because of a higher cost of living. But, wages have been growing strongly which means their incomes when they reach the workforce will also be higher, "he said.

However, Workman says there’s a larger issue that financially affects students.

The superannuation system is set up in favour of the older generation because we run a “pay as you go” system.  

“The aging demographic means younger people are paying for the older generation and there are hard policy choices that need to be made to make it fairer,” he said.

The NZUSA and the Green party want a tertiary education restructure.

“What it comes down to is what looks like sustainable funding for the sector and students and that conversation hasn't really been had at all,” Dixon said. 

Chloe Swarbrick says a universal student allowance would be beneficial.

Currently only a third of students receive a student allowance of $279 a week. 

Swarbrick said the most up-to-date Ministry of Education figures from 2021 show that it would be an approximate 22 percent increase from that to deliver a universal student allowance.

“It’s just not fair.” 

“Right now the government's spending inordinate resources through the Ministry of Education and gatekeeping people from access to the very resources they need to study,” she said.