Incoming HECS debt rise 'too scary' for Maitland midwifrey student

The Bellbird mother-of-two is studying to be a midwife at the University of Newcastle after realising a career in communications and public relations was no longer what her heart desired.

Her HECS is already sitting just over $6000 and with indexation set to rise on June 1 based on the Consumer Price Index (CPI), she says the overarching thought of what her debt will be when she completes her degree in a year's time is "overwhelming".

"This one I think will sit anywhere between 20 and 30 thousand," she said.

"If I think too much about it it becomes too scary. It's a future problem."

Last year HECS debt rose by 7.1 per cent according to the Australian Taxation Office, and while formal indexation figures are yet to be released, reports have pegged the potential rise between 4.5 and 4.8 per cent.

Indexation is calculated annually based on Australian Bureau of Statistics figures and reflects changes in cost of living.

The income contingent nature of the HELP scheme ensures that a person only repays their HELP debt when they earn above the minimum threshold, at a repayment rate that is consistent with their income, not the size of their debt.

"The jump last year was quite terrifying, the additional rise this year - considering the rise in everything else -is very scary," Ms Smith said.

Fortunately with family assistance and voluntary repayments she was able to pay her first study debt of $26,000, but she wished she knew what she was getting herself into.

"I did the standard procedure of a deduction from my income and paid additional amounts where I could as lump sums, but they were pretty substantial amounts," she said.

"It felt substantial to me at the time because it was a decent percentage and being in my early 20s, living out of home and all of those things for the first time it definitely had an impact."

While she's committed and passionate about her studies, she also understands that her second debt will be a step backwards financially.

"I have to do it in order to get to where I want to be and I want to do it. [But] I think it [to pay off] will be harder this time around, much harder," she said.

"Definitely [because of] the cost of living and now I have two children and a mortgage."

"I'm also studying a degree that has a very large clinical component, and I'm not paid for those clinical hours. I'm living through placement poverty," she said.

Ms Smith's advice to other people considering a university degree was to be educated on what attaining a HECS debt means.

"I think because it's not money you have to pay in the immediate moment, it's easy to be frivolous about it when you're young," she said.

"Having done it once, I'm well aware of what I'm getting myself into but the first time round it felt very easy to not worry about HECS, until I had to pay it."

"When making this decision to study make sure it's something you're passionate about and educate yourself on what it looks like. If you have a plan to manage it then you should go for it.

The Australian Universities Accord stated the HECS-HELP system can be made simpler and fairer, including around how indexation is calculated and applied.

Minister for Education Jason Clare said the government plans to respond to the Accord's recommendations shortly.

"In the years ahead, we need more people to get a crack at going to uni and TAFE. That's what our response to the Universities Accord will be all about," he said.